Contents
Page
Company Information
2
Highlights
3
Chairman’s Statement
5
Strategic Report: Operational Review
10
Strategic Report: Financial Review
13
Strategic Report: Section 172 (1) Statement
17
Corporate Governance Report
21
Audit Committee Report
32
Directors’ Remuneration Report
33
ESG Committee Report
35
Directors’ Report
38
Independent Auditor's Report to the Members of Quartix Technologies plc
42
Consolidated Statement of Comprehensive Income
49
Consolidated Statement of Financial Position
50
Consolidated Statement of Changes in Equity
51
Consolidated Statement of Cash Flows
52
Notes to the Consolidated Financial Statements
53
Parent Company Statement of Financial Position
79
Parent Company Statement of Changes in Equity
80
Notes to the Parent Company Financial Statements
81
Notice of Annual General Meeting
87
Notes to the Notice of Annual General Meeting
89
Quartix Technologies plc
2
Financial statements for the year ended 31 December 2024
Company Information
Company registration number:
06395159
Registered office:
No.9 Journey Campus
Castle Park
Cambridge
CB3 0AX
Directors:
Andrew Walters
Alison Seekings
Ian Spence (appointed on 19 February 2024)
Emily Rees (resigned on 26 March 2024)
Company secretary:
Andrew Walters
Bankers:
HSBC Bank Plc
63-64 St Andrews Street
Cambridge
CB2 3BZ
Solicitors:
HCR Hewitsons
50-60 Station Road
Cambridge
CB1 2JH
Auditor:
PKF Littlejohn LLP
Statutory Auditor
15 Westferry Circus
London
E14 4HD
Nominated advisor and broker:
Cavendish
One Bartholomew Close
London
EC1A 7BL
Quartix Technologies plc
3
Financial statements for the year ended 31 December 2024
Highlights
Quartix is one of Europe’s leading suppliers of subscription-based vehicle tracking systems, analytical
software and services.
Financial highlights
•
Group revenue increased by 8% to £32.4m (2023: £29.9m)
•
Adjusted EBITDA1 increased by 21% £6.5m (2023: £5.4m)
•
Adjusted profit before tax2 increased by 25% to £6.3m (2023: £5.1m)
•
Profit for the year was £4.8m (2023: (Statutory Loss) £0.9m)
•
Adjusted diluted earnings per share3 increased to 9.78p (2023: 8.75p)
•
Free cash flow4 increased by 99% to £2.6m (2023: £1.3m).
•
Final proposed dividend payment of 3.00p per share (2023: 1.50p) with no supplementary
dividend (2023: none) giving a total dividend for the year, including the interim dividend, of
4.50p per share (2023: 3.00p)
1 Earnings before interest, tax, depreciation, amortisation, share based payment expense and adjustments (see note 4)
2 Adjusted measure in 2023 is excluding the impairment of intangibles and the provision to replace 2G units offset by the fair
value gain of the future earn out payments
3 Diluted earnings per share before adjustments (see Strategic Report: Financial Review, Financial Overview and note 10)
4 Cash flow from operations after tax and investing activities
Quartix Technologies plc
4
Financial statements for the year ended 31 December 2024
Principal activities and performance measures
The Group’s main strategic objective is to achieve profitable growth in its fleet subscription base and the
associated annualised recurring revenue.
Annualised recurring revenue (for “ARR” see definition in Key Performance Indicators (“KPI”) table
below footnote 4), when measured in constant currency year on year, is the most significant forward-
looking key performance measure. The Group’s ARR increased by £3.5m (+12%) during the year to
£32.2m, representing a record year on year increase of 68% over the ARR growth achieved in 2023.
The KPIs used by the Board to assess the performance of the business are listed in the table below and
discussed in the Chairman’s Statement and Strategic Report.
Key Performance Indicators (“KPIs”)
Year ended 31 December
2024
2023
% change
New Fleet subscriptions1 (new units)
74,673
64,418
16
Fleet subscription base2 (units)
300,168
266,568
13
Fleet customer base3
30,134
27,268
11
Customer Acquisition (new customers)
6,863
5,759
19
Annualised recurring revenue (ARR)4 (£’000)
32,238
28,758
12
Net Revenue Retention (NRR)5 (%)
96
93
3
Fleet invoiced recurring revenue6 (£’000)
30,442
27,764
10
1 New vehicle tracking unit subscriptions added to the subscription base before gross attrition
2 The number of vehicle tracking units subscribed to the Group’s fleet tracking services, including units waiting to be installed for
which subscription payments have started or are committed
3 The number of customers associated with the fleet subscription base
4 Annualised data services revenue for the subscription base at the year end, before deferred revenue, including revenue for units
waiting to be installed for which subscription payments have started or are committed, all measured in constant currency
5 NRR is measured on a constant-currency basis and represents the annualised value of recurring revenues for the customer base
at the end of the year, excluding recurring revenues for customers acquired during the course of the year, divided by the annualised
value at the start of the year, and expressed as a percentage
6 Invoiced subscription charges before provision for deferred revenue
Quartix Technologies plc
5
Financial statements for the year ended 31 December 2024
Chairman's Statement
Introduction
Since my return to the business in late 2023 our entire focus has been on profitable, organic growth via our
core vehicle telematics subscription service. I am pleased to report that the Group has made very substantial
progress in respect of that, achieving record growth in the value of its subscription base and a return to
significant profitability: adjusted profit before tax increased by 25% to £6.3m (2023: £5.1m). We have put
the issues of 2023 behind us and have made substantial investments in the future of the business.
Annualised Recurring Revenue (“ARR”)
ARR is the key forward-looking measure of growth for the Group and an important indicator of
shareholder value. ARR reported by the Group relates solely to committed software subscription revenues
and does not include other service revenues which may recur. The Group's ARR increased by £3.5m
(+12%) during the Period to £32.2m, representing an increase of 68% over the ARR growth achieved in
2023.
Customer acquisition
New customer acquisition during the Period increased by 19% to 6,863 new customers and new
subscriptions increased by 16% to 74,673. The customer base increased by 11% to 30,134, and the total
subscription base increased by 13% to 300,168.
These improvements in growth compared with 2023 were driven by renewed focus on channels to market
in the Group's six target territories. New customer acquisition, in particular, accelerated through the year,
reaching a rate of more than 700 new customers acquired in a rolling 30-day period by December - an
increase of 50% over the rate of acquisition at the end of 2023.
The key metrics shown below include growth expressed as a % for the Period compared to the same period
in 2023.
Country
ARR
(£m)
%
Subscription
Base (units)
%
Customer
Base
%
New
Subscriptions
(units)
%
New
Customers
Acquired
%
UK/EI
17.7
+7%
156,506
+6%
11,668
+3%
30,481
+15%
1,592
+22%
France
8.3
+16%
80,579
+19%
9,174
+11%
23,032
+4%
2,293
+0%
USA
3.4
+7%
29,879
+2%
3,896
+1%
6,837
+14%
794
+13%
Italy
1.3
+53%
14,612
+52%
2,276
+47%
6,329
+42%
955
+60%
Spain
0.9
+40%
11,429
+43%
2,081
+35%
4,655
+35%
811
+31%
Germany
0.6
+63%
6,620
+57%
955
+43%
3,129
+89%
412
+65%
Other
-
543
84
210
6
Total
32.2
+12%
300,168
+13%
30,134
+11%
74,673
+16%
6,863
+19%
Quartix Technologies plc
6
Financial statements for the year ended 31 December 2024
Net Revenue Retention (“NRR”)
Following the successful implementation of price increases across the Group, alongside previously reported
KPIs, the Group has now chosen to include NRR in its reported KPIs as an additional important indicator
of the quality and stability of its recurring revenue base. The Board believes that this additional visibility
over revenue quality provides shareholders with a more comprehensive view of performance than that
provided by attrition and price erosion measures (which are, nonetheless, both determinants of NRR).
NRR is defined as the annualised value of recurring revenues for the customer base at the end of the year,
excluding recurring revenues for customers acquired during the course of the year, divided by the annualised
value at the start of the year, and expressed as a percentage. This is measured on a constant-currency basis.
Positive factors contributing to this measure are incremental orders and upgrades from existing customers
or price increases (“expansion”). Negative contributors are reductions in fleet sizes and price erosion
(“contraction”) and customer losses (“attrition”).
For the year as a whole NRR was 95.7% (2023: 93.0%). Price indexation, when averaged across the base,
amounted to approximately 3%; in 2025 it is expected to be slightly over 5% across the current base.
Through this and improved price control the Group hopes to increase NRR further in 2025, with a longer-
term objective of exceeding 100%.
Regional review
UK/EI
ARR growth of £1.1m was achieved in 2024 (+7% to £17.7m): this was three times the level of growth
achieved in 2023. New customer acquisition increased by 22% to 1,592 over the year and accelerated during
the second half as cost savings in administrative overheads in the business were used for marketing
investment. New subscriptions increased by 15% and prospects for H1 2025 are strong.
France
ARR grew by 16% to £8.3m and the high levels of customer acquisition and new installations achieved in
2023 were maintained. The customer and subscription bases increased by 11% and 19%, respectively.
USA
The USA had suffered from a series of organisational and strategic changes made in 2022 and 2023. This
has necessitated the rebuilding of sales channels from scratch. Good progress was achieved in recruitment
by the middle of 2024 and a $0.22m fall in ARR in 2023 was reversed in 2024, producing an increase of
$0.26m (+7% ARR growth in sterling terms). Most of the staff recruited are experienced telematics sales
executives, and pricing for new contracts has been increased by approximately 22% to bring the Group’s
pricing in the USA more into line with the competition. New subscriptions increased by 14% and customer
acquisition improved by 13%. Most of these improvements developed in the final four months of the year,
and 2024 ended on a positive note.
Spain, Italy and Germany.
Progress in these exciting new markets for the Group accelerated: ARR grew by 51% to £2.9m; new
customer acquisition improved by 49% to 2,178; and new subscriptions grew by 48% to 14,113. The Group
will continue to develop and invest in its channels to market in each of these countries, with a number of
new recruitments already underway at the end of the year.
Quartix Technologies plc
7
Financial statements for the year ended 31 December 2024
Results
Group revenue for the year increased by 8% to £32.4m (2023: £29.9m). It's noteworthy that 42% of group
revenue (45% of Group ARR) now originates from territories outside the UK, exposing this portion to
currency fluctuations against the GBP. Revenue growth at a constant currency, taking the EUR/USD
revenue for 2023 and 2024 converted at the exchange rate at 31 December 2024 was 9%.
In 2024, the Group delivered Adjusted EBITDA of £6.5m (2023: £5.4m), slightly ahead of estimates
provided in the January 2025 trading statement. Included in the Adjusted EBITDA this year is a re-estimate
on the replacement of 2G units in France and the USA which has resulted in a reduction of approximately
£0.5m in the provision to replace these units. This reduction is principally due to cost savings achieved in
future manufacturing costs and the majority of the upgrade programme in the USA having been completed
during the year (see note 19 and commentary concerning new product development).
The Group has opted to voluntarily report its performance in two segments: Total Fleet and Konetik. The
Total Fleet segment has been sub-divided into two further categories. This has been done to give clarity as
to the level of upfront investment the Group is making in acquiring new customers, as well as the associated
impact on recurring revenue. The two sub-categories are:
•
Customer Acquisition: This is the revenue associated with the Group’s new customers in the
year and the cost of servicing those new customers. The costs in this sub-category include all of
the marketing costs and the majority of sales staff costs as it would be expected that all channels
except for field sales would work primarily in obtaining new customers, whilst field sales would
be expected to develop business with both new and existing customers.
•
Fleet Telematics Services: This is the recurring revenue associated with the Group’s active
subscription base and the cost of servicing that subscription base. The costs in this sub-category
include the cost of installing additional units for existing customers and any associated sales costs.
These two elements, together with central fleet costs, make up the Total Fleet segment.
The revenue and costs have been applied to each segment as appropriate in the analysis below:
Segmental analysis
Year ended 31
December 2024
Customer
Acquisition
Fleet
Telematics
Services
Total
Fleet
Konetik
Total
Business
£’000
£’000
£’000
£’000
£’000
Recurring revenue
2,001
28,066
30,067
-
30,067
Other sales
357
1,944
2,301
34
2,335
Total revenue
2,358
30,010
32,368
34
32,402
Segmental costs:
Cost of goods sold
(1,976)
(7,910)
(9,886)
-
(9,886)
Sales and marketing costs
(6,672)
(433)
(7,105)
-
(7,105)
Cost of service
(768)
(4,205)
(4,973)
-
(4,973)
(Loss)/profit before
central costs
(7,058)
17,462
10,404
34
10,438
Central costs
(3,586)
(461)
(4,047)
Fair value gain
-
73
73
Operating profit/(loss)
6,818
(354)
6,464
Quartix Technologies plc
8
Financial statements for the year ended 31 December 2024
Results (continued)
Free cash flow (cash flow from operations after tax and investing activities) excluding the effects of the
investment in Konetik, was £2.7m (2023: £3.3m), slightly ahead of previous guidance. Free cash flow in
2024 was adversely affected by expenditure of £1.3m on the replacement programmes in the USA and
France (2023: £0.1m). Net cash increased to £3.1m at 31 December 2024 (2023: £2.4m).
By the end of 2024, almost all of the 2G units had been replaced in the USA, with fewer than 700 units
remaining to be replaced. At 31 December 2024 there remained 33,000 2G units (31 December 2023:
48,000 units) to replace in France before 31 December 2026 with a total estimated remaining cost of 2.8
million Euros.
Earnings per share
Basic earnings per share increased to 9.85p per share (2023: loss of 1.88p per share). Diluted earnings per
share increased to 9.78p per share (2023: loss of 1.88p per share). The adjusted diluted earnings per share,
which in 2023 was calculated by deducting the fair value gain on re-estimate of the future earn-out payments
and adding back the 2G provision recognised and the impairment of goodwill recognised on the acquisition
of Konetik, was 8.75p.
Dividend policy
Our ordinary dividend policy is to pay a dividend set at approximately 50% of cash flow from operating
activities, which is calculated after taxation paid but before capital expenditure.
In addition to this the Board will distribute the excess of gross cash balances over £2m on an annual basis
by way of supplementary dividends, subject to a 2p per share de minimis level.
The surplus cash is calculated using the year end gross cash balance and after deduction of the proposed
ordinary dividend and is intended to be paid at the same time as the final dividend. The policy will be subject
to periodic review.
Dividend
In the year ended 31 December 2024, the Board decided to pay an interim dividend of 1.50p per ordinary
share. This totalled £0.7m and was paid on 30 September 2024 to shareholders on the register as at 30
August 2024.
The Board is recommending a final ordinary dividend of 3.00p per share, with no supplementary dividend,
giving a total dividend for the year of 4.50p per share, subject to shareholder approval. Whilst this is higher
than that which would be paid under the Company’s dividend policy (see above), the reduction in free cash
flow in 2024 was caused principally by the costs of Konetik and the 4G upgrade programme in France,
both of which are temporary in nature, and hence the Board considers the additional quantum to be
appropriate.
The final dividend amounts to approximately £1.5m in aggregate. Subject to the approval at the
forthcoming AGM, this dividend of 3.00p per share will be paid on 30 April 2025 to shareholders on the
register as at 4 April 2025. The ex-dividend date is therefore 3 April 2025.
Quartix Technologies plc
9
Financial statements for the year ended 31 December 2024
Konetik Deutschland GmbH ("Konetik")
Quartix acquired Konetik in September 2023 for a consideration of up to €3.9m. Konetik was a company
specialising in consultancy services for fleets making the transition to electric vehicles. Konetik had
substantial operating costs but insignificant revenues and the growth anticipated at the time of acquisition
was not delivered.
As noted in the prior year Annual Report, having exhausted all other options including returning the
business to its former owners at nil cost, the Board decided to liquidate Konetik and its Hungarian branch.
Steps were taken in January 2024 to begin the process of liquidation which included terminating all customer
agreements, employment agreements and third party service provider contracts.
Operating costs of £0.5m for Konetik were recorded in the year, and a final payment of approximately
£0.2m was paid in September under the terms of the acquisition agreement. The remaining activity in
Konetik is minimal and consists only of that required during the final stages of liquidation. It is anticipated
that the final closure of Konetik will complete in November 2025.
Outlook
In 2025, we will maintain our rigorous approach to overhead cost analysis. This ongoing scrutiny aims to
further enhance our return on sales, ensuring optimal operational efficiency. Our accelerated development
program will yield significant results; this new telematics platform resulted in a product launch at the end
of 2024 which from July 2025 will substantially decrease our manufacturing costs. This demonstrates our
commitment to innovation and cost-effective operations, aligning with our long-term goals for sustainable
growth and improved financial performance
The year has begun on a strong note: new installations reached a significant new milestone in January and
customer acquisition rates have further increased. This positive momentum, coupled with growth
opportunities across all six territories, underpins our confidence in the outlook for 2025, during which we
believe we will increase our recurring revenues and adjusted profit before tax by approximately 10%.
AGM
The Group’s AGM will be held at 10.30 a.m. on 31 March 2025 at the Company’s registered address No.9
Journey Campus, Castle Park, Cambridge, CB3 0AX.
Andrew Walters
Executive Chairman
Quartix Technologies plc
10
Financial statements for the year ended 31 December 2024
Strategic Report: Operational Review
Strategy and business model
The Group’s main strategic objective is to grow its fleet subscription platform profitably and develop the
associated recurring revenue. This strategy is based on five key elements, which were first highlighted in
the 2018 Annual Report. We are pleased to be able to report progress in each area, as summarised below:
1. Market development: Quartix will continue to focus on fleet markets, exploring further opportunities
within its six existing markets. Investment in and focus on the core business delivered strong
progress in the UK and Continental Europe, and the customer base in the USA returned to growth
during the year.
2. Cost leadership: We continue to seek improvements in the efficiency of the sales cycle and to review
product and overhead costs in order to identify further operational efficiencies. The Group
recognised at the end of 2023 that, in recent years, its overhead structure had grown at a faster
rate than revenues, and in 2024 significant steps were taken to manage and reduce costs where
possible. This will continue in 2025.
3. Continuous enhancement of the Group’s core software and telematics services: Quartix has an ongoing
modernisation program of its core software and telematics firmware and hardware, both from a
technology and user experience perspective. These enhancements help to improve the customer
experience as well as to increase the efficiency of its support operation.
4. Outstanding service: Quartix maintained its excellent reputation with fleet customers throughout the
year, consistently being rated as “excellent” by TrustPilot users. Quartix achieved a Gold Award
from Investors in Customers in 2023, which recognises truly excellent service.
5.
Standardisation and centralisation: the expansion into European markets has been achieved by staff
operating under the existing operational structures in place in the UK, with some sales staff being
located in France. Support and service functions continued to be performed from the UK.
Our fleet customers typically use the Group’s vehicle telematics services for many years following an initial
contract. Accordingly, the Group focuses its business model on the development of subscription revenue,
with high levels of revenue retention, providing the best return to the Group over the long term.
The number of vehicles connected to our subscription platform and the value of recurring subscription
revenue derived from it are the key measures of our performance in the fleet sector. As noted in the
Principal activities and performance measures section, the annualised recurring revenue increased by £3.5m,
at a constant currency rate, to £32.2m at 31 December 2024.
People
We take great pride in the service we provide, and it is rewarding to see this reflected in the feedback we
receive. Fleet customers consistently give us excellent reviews, including over 1,000 Trustpilot reviews with
an impressive average score of 4.9 in 2024.
These achievements highlight the dedication, creativity, and teamwork of our people and underscore our
commitment to delivering an outstanding customer experience. Quartix was awarded a Gold Award in 2023
following an assessment by Investors in Customers, a testament to our exceptional customer service.
Additionally, we were honoured with the Fleet News 2024 Reader Recommended Award, further demonstrating
the positive perception and strong awareness of the Quartix brand.
Financial success in our core business is built on this commitment to service, supported by our innovative
product. The Board extends its sincere thanks to every employee whose hard work and dedication
contributed to our continued growth in 2024.
Quartix Technologies plc
11
Financial statements for the year ended 31 December 2024
Research and development
The Group is committed to the continuous enhancement of its core software and telematics services, and
we aim to offer a market-leading platform which addresses the most common needs of SME customers in
the service sector of each of our target markets.
Key developments included:
1. Telematics hardware and firmware. Development of the Group's latest generation of telematics system,
the TCSV17, was initiated and released to production in the period. The development marked the
most significant revision of both hardware and firmware design for at least a decade. The design
objectives were focused principally on cost reduction, but some significant advances have also been
made in performance. The cost saving achieved is approximately £8 per unit and the TCSV17 will
account for 7,000 units per month of usage in 2025 from July onwards.
2. Application software Initial versions of revised web-based and mobile tracking applications were
developed and released during the year. The new web-based application was released to new
customers in July 2024 and completion of the application and its introduction to existing customers
will be accelerated in 2025.
All of our investment in research and development was fully expensed in the year with a total cost of
£0.9m in 2024 (2023: £1.1m).
UK 2G Network
The Board continues to monitor the situation concerning the eventual phasing out of 2G mobile network
coverage in the UK. All UK network operators have agreed to sunset their 2G networks no later than 2033.
Since Q4 of 2022, all new installations of the Group’s tracking systems in the UK have either been of its
wired, 4G-compatible units or of plug-in, user-installed trackers equipped with SIM cards which can roam
across any of the available UK 2G networks. Given the very high level of fixed 2G device installations in
the UK for applications such as smart meters, critical infrastructure and remote monitoring it is expected
that some networks will continue through until the 2033 deadline.
At the end of 2024 the Group had 84,000 UK installations using 2G network services with its principal
network service provider. These will not currently roam onto other networks. This total is reducing at a
rate of approximately 1,400 units per month through natural replacements (service upgrades and vehicle
swaps) as well as some attrition. The Board understands that its network service provider currently has just
under 4 million 2G installations with other customers in the UK, and that it will enter into further discussion
with all customers regarding the phasing-out process towards the end of 2025, with a view to completing
the transition before the end of the decade. Given the current rate of reduction in the Group’s 2G installed
base and the anticipated cooperation and support of its service provider the Board does not believe that
any material replacement cost will be incurred in the foreseeable future.
Sustainability and Environmental, Social, and Governance (“ESG”) matters
The Board is aware that investors are increasingly applying non-financial factors, such as ESG matters, as
part of their analysis process to identify material risks and growth opportunities. Being part of an ethical,
purpose driven business increasingly matters more to our people, our shareholders and our business
partners.
Software companies such as Quartix have a central role in the transition to a low carbon economy and a
more sustainable future. The Group is essentially a non-emitting and limited-consuming business and the
Board believes the Group’s limited use of carbon energy is largely offset by the savings that we achieve for
our customers in reduced fuel consumption and other efficiencies in vehicle fleet management.
Quartix Technologies plc
12
Financial statements for the year ended 31 December 2024
Sustainability and Environmental, Social, and Governance (“ESG”) matters (Continued)
In 2022 Quartix was granted the London Stock Exchange’s “Green Economy Mark”, which champions
pioneering London-listed companies driving growth in the global green economy. To qualify, companies
must generate at least 50% of their total annual revenue from products and services that significantly
contribute towards the transition to a low carbon economy. The Mark was received due to analytics from
an external consultancy firm and evidence from our customers, that fleet vehicle tracking and analytics
changes driver behaviour and results in a reduction of between 10-25% in fuel consumption.
Capacity for future growth
Quartix is well-positioned for substantial profitable growth in its fleet business. The Group plans to
capitalize on this opportunity by making strategic investments in sales channels throughout 2025 and
beyond.
Management believes that significant portions of its existing addressable markets remain untapped,
presenting ample opportunity for expansion. Simultaneously, Quartix aims to capture market share from
competitors in more mature markets.
To drive growth, the Group will focus on two key strategies:
•
Implementing data-driven optimization across the sales and marketing funnel
•
Executing automation and simplification initiatives across business processes
These targeted investments in sales channels are expected to yield positive results in 2025, with anticipated
increases in both new fleet unit installations and the value of the annualized subscription base. This
approach aligns with Quartix's commitment to sustainable growth and market leadership in the vehicle
telematics industry
Andrew Walters
Executive Chairman
Quartix Technologies plc
13
Financial statements for the year ended 31 December 2024
Strategic Report: Financial Review
Financial Overview
Year ended 31 December
£’000 (except where stated)
2024
2023
% change
Revenue
32,402
29,882
8
Gross profit
22,516
16,978
33
Gross margin
69%
57%
Operating profit/(loss)
6,464
(1,056)
712
Operating margin
20%
(4%)
Adjusted EBITDA (note 4)
6,538
5,397
21
Profit/(Loss) for the year
4,766
(908)
625
Earnings per share
9.85
(1.88)
Diluted earnings per share
9.78
(1.88)
Cash generated from operations
4,097
4,465
(8)
Adjusted operating profit to operating cash
flow conversion
63%
88%
Free cash flow (excluding acquisition)
2,745
3,277
(16)
Revenue
Revenue increased by 8% to £32.4m (2023: £29.9m). As stated in the Chairman Statement it's noteworthy
that 42% of group revenue now originates from territories outside the UK, exposing this portion to
currency fluctuations against the GBP. Revenue growth at a constant currency, taking the EUR/USD
revenue for 2023 and 2024 converted at the exchange rate at 31 December 2024 results in revenue growth
in the year of 9%. Price indexation, which was introduced in 2024 contributed approximately £0.9m to
annualised recurring revenue, with the majority of this contributing to the increase in the invoiced revenue
in the year.
Gross margin
Gross margin has increased year-on-year from 57% in 2023 to 69% in 2024. Almost all of this increase is
due to the significant provision raised in the prior year to upgrade 2G tracking systems in France to 4G.
The Group achieved a slight reduction in the cost to manufacture its 4G-compatible tracking systems in
the second half of 2023, and this was followed by the introduction of a new 4G-only system at the end of
2024 which has a substantially lower manufacturing cost than previous products. The effect of these cost
savings will gradually improve gross margin over time as the amortisation of the cost of earlier versions
unwinds.
Quartix Technologies plc
14
Financial statements for the year ended 31 December 2024
Overheads
Sales & marketing investment increased by 12% to £7.1m (2023: £6.4m). Administrative expenses
decreased by 3% to £9.0m (2023: £9.3m).
Throughout the year, the Group undertook targeted cost management initiatives, resulting in a 14%
reduction in administrative expenses from the first half to the second half of the year. As demonstrated in
the table below approximately half of these savings were strategically reinvested during the second half,
primarily in sales and marketing efforts resulting in an 11% increase in sales & marketing costs in the second
half. This included recruiting new sales agents to support the U.S. market and increasing marketing
expenditures to drive lead generation
Overhead analysis
£’000 (except where stated)
6 months to
30 June 2024
6 months to
31 Dec 2024
% change
Full year
2024
Sales and marketing expenses
3,367
3,738
11%
7,105
Administrative expenses
4,654
3,905
(14%)
8,559
Konetik costs
411
50
(88%)
461
Total overheads
8,432
7,693
(9%)
16,125
Adjusted EBITDA
Adjusted EBITDA, increased to £6.5m (2023: £5.4m). In addition to price indexation which was
introduced at the start of the year and the excellent progress made in the subscription base during the year,
profitability improved as administrative and management overheads were reduced and the Group steadily
improved upon the optimisation of its operational systems. Operational costs of the Konetik subsidiary
were terminated in the first half of the year. Many of the improvements listed have yet to show a full-year
benefit to profit.
Taxation
The UK effective tax rate has increased from 16% in 2023 to 25% in 2024, following the applicable tax rate
increasing from 19% to 25%, a reduction in the R&D credit available and the loss relief available in the
USA.
Statement of financial position
Property, plant and equipment, fell marginally to £0.6m (2023: £0.7m).
Contract cost assets increased to £6.2m (2023: £5.4m). Inventories increased to £1.7m (2023: £1.4m) due
to the increase in stockholding to accommodate the French replacement programme. Cash at the year-end
was £3.1m (2023: £2.4m). Trade and other receivables decreased to £4.1m (2023: £4.2m), which correlates
with the trade receivables collection period decreasing from 42 days to 38 days. One of the key drivers of
this was utilising a debt collection agency to collect debts in France and other European Territories. Trade
and other payables were £4.0m (2023: £4.0m) largely due to the discharge of the deferred consideration for
the acquisition of Konetik of £0.3m offset by higher accruals. Provisions decreased from £4.2m to £2.3m
due to progress and re-estimate on anticipated costs per unit on 2G/3G unit replacement programmes.
Contract liabilities represent customer income invoiced in advance of satisfying performance obligations,
which are expected to be recognised as revenue in future years. These increased to £3.8m in 2024 (2023:
£3.7m) and are described further in note 20.
Quartix Technologies plc
15
Financial statements for the year ended 31 December 2024
Cash flow
Cash generated from operations before tax at £4.1m was 63% of operating profit (2023: £4.5m, 88% of
adjusted operating profit). Tax paid in 2024 was marginally higher at £1.3m (2023: £1.2m). As a result, cash
flow from operating activities after taxation but before capital expenditure was £2.8m (2023: £3.3m).
The free cash flow (cash flow from operating activities and after investing activities) was £2.6m (2023:
£1.3m). Included in the cash outflows this year was the balancing payment to Konetik shareholders under
the share purchase agreement of £0.2m, £0.4m of Konetik operating costs and approximately £1.3m paid
for the replacement programmes. The translation of cash flow into dividends is covered in the Chairman’s
Statement.
Risk Management policies
The principal risks and uncertainties of the Group are as follows:
Attracting and retaining the right number of good quality staff
The Group believes that in order to safeguard the future of the business it needs to recruit, develop and
retain the next generation of staff. The impact of not mitigating this risk is that the Group ceases to be
innovative and provide customers with the vehicle telematics services they require. Considerable focus has
been given to recruitment, development and retention. The Group has a range of tailored incentive schemes
to help recruit, motivate and retain top quality staff, which include the use of share options.
Reliance on Mobile To Mobile (“M2M”) network
The Group’s service delivery is dependent on a functioning M2M network covering both the internet and
mobile data. The impact of not mitigating this risk is that the Group is exposed to an M2M outage. Quartix
has dual site redundancy to cover a localised internet problem and we are constantly working on improving
the reliability of our systems architecture.
Management believes that, at some point between 2025 and 2030, most UK and European network
operators will finalise the sunsetting of their 2G networks. The final networks to withdraw 2G service in
France announced their sunsetting programme in 2023, which is due to complete by the end of 2026.
Quartix began its proactive 2G unit replacement programme in France in January 2024. The Company
continues to monitor the announcements regarding the UK sunsetting of the 2G network, and depending
on the actual timetable and the commercial climate, there may be a cost at that time associated with the
upgrading of customers’ technology, which the Group is seeking to minimise through various technological
and commercial means. Management continue to review the situation for network migration in the UK.
Currently all new systems installed are either 4G compatible or make use of a roaming sim card which can
use a range of 2G networks, as the Group believe that some 2G networks will be operational until 2030.
Business disruption
Like any business the Group is subject to the risk of business disruption. This includes communications,
physical disruption to our sites and problems with our key suppliers. The impact of not mitigating this risk
is that the Group may not be able to service its customers. Quartix has a Business Continuity plan and
business interruption insurance to cover certain events to help mitigate these risks.
The Group acquires, manages and supports its customers in the EU centrally, from its offices in the UK.
The BREXIT trading and data adequacy arrangements have not made it necessary for a relocation of some
of its operations to within the EU. However, the existing French business is instrumental in the logistics
of moving the goods between France and customers in the EU.
Potential new US tariffs and geopolitical tensions could lead to more volatile global prices and trade
disruptions, which has a potential impact on global supply chains. The Group’s product currently has a
duty free tariff and the risk of component shipment delays as a result of tariffs and geopolitical tensions is
mitigated through stockholding at its third party manufacturing warehouse in China.
Quartix Technologies plc
16
Financial statements for the year ended 31 December 2024
Risk Management policies (continued)
Business disruption (continued)
Inflation is expected to remain elevated, higher costs may put pressure on profit margins and impact cash
flows for businesses, particularly if they struggle to pass on increased expenses to customers. Coupled with
higher borrowing costs these factors could strain companies with significant debt or those relying on
refinancing. The Group does not have any debt, however there may be an impact on the Group’s customer
base and therefore the Groups ability to collect cash from its customers. The Group continues to work
with a debt collector that covers all territories in an effort to increase the probability of collection of debt
following the 45 days overdue period has passed. The Group continues to review its collection process and
credit control efforts to mitigate the risk.
Cyber security
The Group needs to make sure its data is kept safe and that there is security of supply of data services to
customers. The reputational and commercial impact of a security breach would be significant. To combat
this, the Group has a security policy and prepares a security report which is reviewed by members of the
Operations Board. This process includes the use of outside consultants for penetration testing and security
review.
Technology
Technology risks are perceived to arise from possible substitutes for the current Quartix product. Risks
cited include everything from smart mobile phones and their applications to driverless cars. The Group
strategy is to review all new technical developments with the aim of adopting any which will provide a better
channel for the information services which Quartix provides.
Quartix Technologies plc
17
Financial statements for the year ended 31 December 2024
Section 172 (1) Statement
In accordance with the Companies Act 2006 (Act), as amended by the Companies (Miscellaneous
Reporting) Regulations 2018, the Directors provide this statement to describe how they have engaged with
and had regard to the interest of our key stakeholders when performing their duty to promote the success
of the Group, under Section 172 of the Act. The Directors consider, both individually and together, that
they have acted in the way they consider, in good faith, would be most likely to promote the success of the
Group for the benefit of its members as a whole (having regard to the stakeholders and matters set out in
Section 172 of the Act) in the decisions taken during the year ended 31 December 2024.
Given the importance of our stakeholders and the impact they have on our strategy, reputation and the
Group’s long-term success, consideration has been given to them throughout the 2024 Annual Report and
the table below identifies where they are discussed:
Section 172 responsibility
Where you can read more
The likely consequence of any decision in the
long-term
Outlook on page 9
Strategic Report: Operational review: Strategy
and business model page 10. Capacity for future
growth page 12
Corporate Governance Report: section 1 page
22 and section 9 on page 29-30
The interests of the Group’s employees
Strategic Report: Operational review: Strategy
and business model page 10
Corporate Governance Report: Section 3 page
24-25
The need to foster the Group’s business
relationships with suppliers, customers and
others
Strategic Report: Operational review: Strategy
and business model page 10
Financial Overview: Risk Management (M2M
network and business disruption) page 15-16.
Corporate Governance Report: Section 3 page
24-25
The impact of the Group’s operations on the
community and the environment
Our commitment to our stakeholders: page 11
The ESG report: page 35-37
The desirability of the Group maintaining a
reputation for high standards of business
conduct
Corporate Governance Report: Section 8 Page
28
The need to act fairly as between members of
the Group
Corporate Governance Report: Shareholder
engagement page 22
The Corporate Governance Code also highlights the importance of effective engagement with shareholders
and other stakeholders. Engaging with our stakeholders and the issues that matter to them allows us to
take more informed decisions and better identify the consequences of our actions on our stakeholders,
whilst recognising that each decision will not always result in a positive outcome for each of our
stakeholders. By having good governance procedures in place, the Board aims to make sure that its decisions
maintain a high standard of business conduct.
Quartix Technologies plc
18
Financial statements for the year ended 31 December 2024
Our commitment to our stakeholders
The following table sets out how we engage with our key stakeholders.
Our
stakeholders
What has mattered to them
this year?
Our response
Customers
Consistent quality service and
support, to customers.
Innovation
to
support
their
business.
Concerns
about
impact
of
network upgrades on services.
The Board’s main strategic objective is to grow
its fleet subscription platform and develop the
associated recurring revenue. This was
supported
by
each
of
the
following
decisions/actions:
Providing data services consistently throughout
the
year,
having
invested
in
robust
infrastructure.
Prompt development response to product
innovation.
Timely development of new generation
hardware
to
meet
changing
network
requirements.
Provision of free replacement of units, to
prevent lack of services due to an incompatible
product.
Employees
Great career in a positive and
motivating work environment
underpinned by a supportive
culture.
Focus this year on team building
and integration of teams working
in our two offices, namely in
Newtown and Cambridge and
those still working remotely.
Continuing to focus on developing culture that
inspires and motivates staff.
Encouraging and offering staff opportunities to
progress
within
the
business
in
new
roles/departments, to seek to retain them for
the long-term benefit of the business.
Actions to retain and support staff included:
• Return to the office 5 days a week in our
main trading office in Newtown and 3 days
a week in the Cambridge office to support
collaboration and teamworking.
• Whole Group 2 day conference in
Newtown
with
presentations
and
communication sessions to inform and
grow partnerships between remote working
and office based teams.
• Relationship building through team quizzes
and fund-raising activities.
• Mental health & wellbeing initiatives
including an employee wellbeing solution
which saw an improvement in engagement,
motivation, teamwork and interaction.
• Introduction of recommendations from
Investors in Customers, where we were
awarded Gold in 2023
Quartix Technologies plc
19
Financial statements for the year ended 31 December 2024
Our commitment to our stakeholders (continued)
Suppliers:
component
suppliers,
network
providers,
installation
engineers,
distributors,
marketing
support
Our
Suppliers
want
us
to
be
trustworthy
and
build
long-term
mutually beneficial relationships.
Maintain our product and ethical
standards across our supply chain.
The Group actively looks to create long-
term collaborative relationships with key
suppliers.
The Group expects its suppliers and
distributors to demonstrate a culture that
reinforces ethical and lawful behaviours
and periodically conducts inspection audits
at the key assembler in China. An
inspection is planned in 2025.
Communities
and the
environment
Communities
want
us
to
act
responsibly, to create employment
locally to help their communities thrive
and reduce environmental impact.
We believe that sustainability and ESG
matters, including climate change, are
increasing in importance.
The more successful we can be as a
business, the greater difference we can
make to our communities.
We encourage staff to engage with local
charities and in 2021 introduced a
donations policy. A number of successful
fund-raising events were held during 2024
with good staff engagement in the support
of
our
nominated
charity
“Montgomeryshire Family Crisis Centre”.
Vehicle tracking services generally impact
driver behaviour and should have a
positive impact on the environment.
The Group strategy is to review all new
technical developments with the aim of
adopting any which will provide a better
channel for the information services which
Quartix provides, including adapting to
environmentally
driven
changes
to
vehicles.
The Group engaged with a third-party
consultant to improve the processes of
capturing, measuring and reporting on its
environmental impact.
Shareholders
The major areas raised include:
Communication.
The Board is committed to maintaining an
appropriate level of communication with
shareholders (see section 2 of the
Corporate Governance Report) and has
issued regular trading updates and held
investor
presentations
and
meetings
throughout the year.
Quartix Technologies plc
20
Financial statements for the year ended 31 December 2024
Our commitment to our stakeholders (continued)
Shareholders
(continued)
Corporate governance topics, such as
succession planning.
The composition of the shareholder
base, and transferability of shares, the
dividend policy.
For changes in the Board that took place
in 2024 see section 5 of the Corporate
Governance Report.
Shareholder
base
composition
communicated on the website.
Clear communication of the dividend
policy in the Annual Report and a
consistency of approach other than in
exceptional circumstances.
We believe we have the right strategy and service in place to deliver strong growth in sales over the medium
to long term and to deliver sustainable shareholder value.
The Strategic Report, comprising the Operational Review and Financial Review, and the s172 statement
was approved by the Board of Directors and signed on behalf of the Board on 28 February 2025.
Andrew Walters
Executive Chairman
Quartix Technologies plc
21
Financial statements for the year ended 31 December 2024
Corporate Governance Report
Chairman’s Corporate Governance Statement
All members of the Board believe strongly in the value and importance of good corporate governance and
in our accountability to all of Quartix’s stakeholders, including shareholders, staff, customers and suppliers.
In the statement below, we explain our approach to governance, and how the Board and its committees
operate.
The corporate governance framework which the Group operates, including board leadership and
effectiveness, board remuneration, and internal control is based upon practices which the Board believes
are appropriate for the size, risks, complexity and operations of the business and is reflective of the Group’s
values. Of the two widely recognised formal codes, we have therefore decided to adhere to the Quoted
Companies Alliance’s (QCA) Corporate Governance Code for small and mid-size quoted companies. In
November 2023 a revised QCA code was released, the key updates include:
•
Wider Stakeholder Interests: Enhanced focus on ESG responsibilities and stakeholder engagement
(Principle 4).
•
Board Composition: Stricter requirements for board independence and diversity (Principles 6
and 7).
•
Succession Planning: Emphasis on clear succession strategies (Principle 8).
•
Remuneration Policy: New guidelines to align remuneration with long-term value creation
(Principle 9).
As is permitted by the guidance set out by the QCA, the transitionary period of 12 months following 1
April 2024 is being utilised to put in place measures to embrace the key updates to the QCA code where
possible.
The QCA Code is constructed around ten broad principles and a set of disclosures. The QCA has stated
what it considers to be appropriate arrangements for growing companies and asks companies to provide
an explanation about how they are meeting the principles through the prescribed disclosures. We have
considered how we apply each principle to the extent that the Board judges these to be appropriate in the
circumstances, and below we provide an explanation of the approach taken in relation to each. The Board
considers that it has complied with the principles of the QCA Code.
Roles and responsibilities of Chairman
Andrew Walters is the Executive Chairman. The Chairman is responsible for running the Board and
ultimately for all corporate governance matters affecting the Group.
The Chairman is responsible for leadership of the Board, setting its agenda and monitoring its effectiveness.
He ensures effective communication with shareholders and that the Board is aware of the views of major
shareholders. He ensures that the Executive Team develop a strategy which is supported by the Board as a
whole. The Executive Team are responsible for executing the strategy once agreed by the Board.
Board composition and compliance
The QCA Code requires that the boards of AIM companies have an appropriate balance between Executive
and Non-Executive Directors of which at least two should be independent. For the majority of 2024 we
satisfied this requirement. In February 2024 a second independent Non-Executive Director was appointed
to increase the number of independent Non-Executive Directors from one to two.
Quartix Technologies plc
22
Financial statements for the year ended 31 December 2024
Board composition and compliance (continued)
The Independent Non-Executive Directors bring wide and varied commercial experience to the Board and
Committee deliberations. They are appointed for an initial three-year term, subject to election by
shareholders at the first AGM after their appointment, after which their appointment may be extended
subject to mutual agreement and shareholder approval. A Non-Executive Director is typically expected to
serve two three-year terms but may be invited by the Board to serve for an additional period. Any term
renewal is subject to Board review and AGM re-election. The Company remains committed to a Board
which has a balanced representation of Executives and Non-Executives.
Board evaluation
We support the QCA Code’s principle to review regularly the effectiveness of the Board’s performance as
a unit, as well as that of its committees and individual Directors. We may consider the use of external
facilitators in future board evaluations.
Shareholder engagement
We have made significant efforts to ensure effective engagement with both institutional and private
shareholders. In addition to the AGM, we have roadshows with investors and prospective investors to not
only share our financial results, but also to share the leadership’s future plans and strategy in an open and
interactive forum.
The Board is aware that following the introduction of the Markets in Financial Instruments Directive II
(MiFID II) regulations at the start of 2018, private investor access to research on public companies has
been restricted. We have not commissioned any “paid for” research from third party analysts and have no
current intention of doing so.
The Board has ultimate responsibility for reviewing and approving the Annual Report and Accounts and it
has considered and endorsed the arrangements for their preparation, under the guidance of its Audit
Committee. The Directors confirm that the Annual Report and Accounts, taken as a whole, is fair, balanced
and understandable and provides the information necessary for shareholders to assess the Group’s position
and performance, business model and strategy.
10 Principles of the QCA Code
1
Establish a strategy and business model which promote long-term value for
shareholders
The Group’s main strategic objective is to grow its fleet business and develop the associated recurring
revenue by increasing the number of vehicles under subscription.
The value of recurring subscription revenue is the key measure of our performance.
Fleet customers typically use the Group’s vehicle telematics services for many years, resulting in low rates
of gross attrition. Accordingly, the Group focuses its business model on the development of subscription
revenue based on minimal initial commitment from the customer, providing the best return to the Group
over the long term.
The key risks and uncertainties we face are included under the Strategic Report: Financial Review.
Quartix Technologies plc
23
Financial statements for the year ended 31 December 2024
2
Seek to understand and meet shareholder needs and expectations
Responsibility for investor relations rests with the Executive Chairman. During 2024 the following activities
were pursued to develop a good understanding of the needs and expectations of all constituents of the
Group’s shareholder base:
Date
Description
Participants
Comments
Jan
Trading statement
Board
Feb
Preliminary results meeting
Executive
Chairman
Mar
Presentations to
institutional investors and
analysts
Executive
Chairman
The Executive Chairman prepares and
review with the Board detailed
presentations covering the Group’s
activities over the relevant period and
take guidance from the brokers.
Mar
Annual results video
Executive
Chairman
Presentations disseminated via website
at 7.00 a.m. on morning of results
release so all information publicly
available to all shareholders and
potential investors.
Mar
AGM
Board
All shareholders are invited to attend
Mar
AGM trading statement
Board
Jul
Trading update statement
Board
Jul
Interim results presentations
to institutional investors and
analysts
Chairman
Presentations disseminated via website
at 7.00 a.m. on morning of results
release so all information publicly
available to all shareholders and
potential investors.
Jul
Interim results video
Executive
Chairman
Video disseminated via website (see
above)
Oct
Trading statement
Board
Meetings with key institutional
investors held by the Executive
Chairman
various
Potential investor meetings
Executive
Chairman
Presentation to potential investors
The Group is committed to communicating openly with its shareholders to ensure that its strategy and
performance are clearly understood. As illustrated in the table above, we communicate with shareholders
throughout the year by various formats. A range of corporate information (including all Quartix
announcements) is also available to shareholders, investors and the public on our website.
Private shareholders: The AGM is the principal forum for dialogue with private shareholders and the
Board invite all shareholders to attend and participate. The Notice of Meeting is sent to shareholders at
least 21 days before the meeting. The chairs of the Board and all committees, together with all other
Directors, attend the AGM and are available to answer questions raised by shareholders. Shareholders vote
on each resolution and subsequently publish the outcomes on our website.
Quartix Technologies plc
24
Financial statements for the year ended 31 December 2024
2
Seek to understand and meet shareholder needs and expectations (continued)
Institutional shareholders: The Directors actively seek to build a mutual understanding of objectives with
institutional shareholders. Our Executive Chairman makes presentations to institutional shareholders and
analysts immediately following the release of the full-year and half-year results. We communicate with
institutional investors frequently through formal meetings. The majority of meetings with shareholders and
potential investors are arranged by the broking team within the Group’s nominated advisor. Following
meetings, the broker provides anonymised feedback to the Board from all fund managers met, from which
sentiments, expectations and intentions may be gleaned. In addition, we review analysts’ notes to achieve a
wide understanding of investors’ views. This information is considered by the Board.
3
Take into account wider stakeholder and social responsibilities and their
implications for long-term success
Staff – our ability to fulfil customer requirements and execute our strategy relies on having talented and
motivated staff.
Reason for engagement: Good two-way communication with staff is a key requirement for high levels of
engagement.
How we engage:
•
Regular staff briefings via email or video presentation during 2024.
•
A Q3 Group wide overnight event held at the main UK office.
These have provided insights that have led to enhancement of management practices and staff incentives.
Customers – our success and competitive advantage are dependent upon fulfilling customer requirements,
particularly in relation to quality of service and report reliability.
Reason for engagement: Longevity of customer relationships is a key part of our strategy.
Understanding current and emerging requirements of customers enables us to develop new and enhanced
services, together with software to support the fulfilment of those services.
In 2024, Quartix was honoured with the Fleet News Reader Recommended Award, a particularly significant
recognition as it was based on an external survey of fleet managers, asking which telematics provider they
would recommend. This award is a testament to the exceptional product and customer experience that our
customers consistently benefit from.
How we engage:
•
We use a tool SimpleSurvey to get a CSAT survey after each closed support case
•
Regular customer interviews to gather feedback for product roadmaps
•
Annual online customer survey
Quartix Technologies plc
25
Financial statements for the year ended 31 December 2024
3
Take into account wider stakeholder and social responsibilities and their
implications for long-term success (continued)
Suppliers – We have a range of suppliers including those who provide us with hardware, communication
services, installation services and marketing support.
Reason for engagement: Good services from our suppliers are critical to us delivering the data services to
our customers.
How we engage:
•
Co-ordinate and manage our network of installers to ensure on-time activation of tracking devices.
•
Operate systems to ensure that supplier invoices are processed and paid on time.
Shareholders – as a public company we must provide transparent, easy-to-understand and balanced
information to ensure support and confidence.
Reason for engagement: Meeting regulatory requirements and understanding shareholder sentiments on the
business, its prospects and performance of management.
How we engage:
•
Regulatory news releases.
•
Keeping the investor relations section of the website up to date.
•
Publish videos of investor presentations and interviews.
•
Annual and half-year reports and presentations.
•
AGM.
We believe we successfully engaged with our shareholders over the past 12 months.
4
Embed effective risk management, considering both opportunities and threats,
throughout the organisation
The Group has a risk register that identifies key risks and all members of the Board are provided with a
copy of the register. The register, including control mechanisms to mitigate risks, is reviewed by the Board
and is updated following each such review.
The key risks and uncertainties are included in the Strategic Report: Financial Review.
Staff are reminded on appointment and on a bi-annual basis that they should seek approval from the
Company Secretary if they, or their families, plan to trade in the Group’s equities.
5
Maintain the Board as a well-functioning, balanced team led by the chair
The members of the Board have a collective responsibility and legal obligation to promote the interests of
the Group and are collectively responsible for defining corporate governance arrangements. Ultimate
responsibility for the quality of, and approach to, corporate governance lies with the chair of the Board.
For the majority of 2024, the Board consisted of one Executive and two independent Non-Executives. The
following plc Board changes took place in 2024:
•
in February 2024 the nominations committee appointed Ian Spence, a second independent Non-
Executive Director, to achieve an equally balanced Board of two Executive Directors and two
Non-Executive Directors. He subsequently became the Chairman of the Nominations Committee.
•
in March 2024 Emily Rees, Executive Director, resigned.
Quartix Technologies plc
26
Financial statements for the year ended 31 December 2024
5
Maintain the Board as a well-functioning, balanced team led by the chair
(continued)
The Board is supported by three committees: audit, remuneration and nominations committees.
Non-Executive Directors are required to attend 10-12 Board meetings per year (in Cambridge, Newtown
and London or remote via telephone call) and to be available at other times as required for face-to-face and
telephone meetings with the executive team and investors. In addition, they attend Board committee
meetings as required.
Meetings held during 2024 and the attendance of Directors is summarised below:
Board meetings
Audit
Committee
Remuneration
Committee
Nominations
Committee
Held
Present
Held
Present
Held
Present
Held
Present
Executive Directors
Emily Rees 1
11
2
2
-
-
-
-
-
Andrew Walters
11
11
-
-
1
1
2
2
Non-Executive
Directors
Alison Seekings
11
11
2
2
1
1
2
2
Ian Spence 2
11
11
2
2
1
1
2
2
1 Emily Rees resigned from the board in March 2024
2 Ian Spence was appointed to the Board in February 2024
The Nominations Committee meets when required in relation to Board appointments. Two meetings were
held in 2024. There has been no separate meeting of the Remuneration Committee in 2024 further to the
resignation of Emily Rees as Executive Director in March 2024. The Board as a whole retained oversight
for ESG.
The Board has a schedule of regular business, financial and operational matters, and each Board committee
has compiled a schedule of work to ensure that all areas for which the Board has responsibility are addressed
and reviewed during the course of the year. The Chairman is responsible for ensuring that, to inform
decision-making, Directors receive accurate, sufficient and timely information. The Finance Director
compiles the Board and committee papers which are circulated to Directors prior to meetings. The
Company Secretary provides minutes of each meeting and every Director is aware of the right to have any
concerns minuted and to seek independent advice at the Group’s expense where appropriate.
6
Ensure that between them the Directors have the necessary up-to-date
experience, skills and capabilities
All members of the Board bring relevant sector experience in software and business services, governance
and finance. The Board believes that its blend of relevant experience, skills and personal qualities and
capabilities is sufficient to enable it to successfully execute its strategy. Where relevant, the Directors
research relevant information, including online material, and occasionally attend seminars and trade events,
to ensure that their knowledge remains current.
Key to committees/roles: E: Executive, N: Nomination, A: Audit, R: Remuneration, C: Chair
Quartix Technologies plc
27
Financial statements for the year ended 31 December 2024
6
Ensure that between them the Directors have the necessary up-to-date
experience, skills and capabilities (continued)
Andrew Walters, Executive Chairman (CR, N)
Background:
Andrew Walters founded Quartix in 2001 with three colleagues. Prior to that he was Managing Director of
a subsidiary of Spectris plc for 6 years and had spent 15 years with Schlumberger in the UK and France,
where he was Marketing Director of the payphones and smart cards division.
His financial involvement with Quartix is his annual Executive salary and he is a major shareholder in the
Company so is not an independent Director.
Current external appointments:
Some voluntary business mentoring for The Prince’s Trust.
Skills and experience:
Andrew holds an MA in electrical sciences from the University of Cambridge and developed the Company’s
UK patent, granted under the Patents Act 1977. He has many years’ experience of the vehicle tracking
market, having started the company in 2001 with three colleagues, and has been fully engaged in all aspects
of the business throughout this time.
Time commitment: 8 days a month
Alison Seekings, Independent Non-Executive Director (CA, N)
Background:
Alison is a senior finance leader with extensive experience of working at board level. She has worked in
large professional services firms, formerly with Deloitte and then as a partner with Grant Thornton UK
LLP until 2021. Alison has over 30 years’ experience of advising boards and supporting companies with
their financial strategy and reporting requirements.
Current external appointments:
Alison is the founder of her own consultancy company called Seekings Advisory Limited, and also sits as a
non-executive director for Midwich Group plc and a private company Green and Purple Limited and is
CFO for RQ Biotechnology Limited.
Skills and experience:
Alison is a qualified chartered accountant and chartered tax adviser and has a degree in Natural Sciences
from the University of Cambridge.
Time commitment: 1-2 days a month
Ian Spence, Independent Non-Executive Director (CN, A)
Background:
Ian has more than 25 years' experience in researching and advising companies in the technology sector. Ian
started his career in the City as a technology analyst working for, amongst others, Robert W Baird, WestLB
Panmure and Bridgewell. He later went on to start Megabuyte, a leading company intelligence platform
focusing on UK mid-market tech businesses, where he is currently Executive Chairman.
Current external appointments:
In addition to Megabuyte, Ian's other current roles include Non-Executive Director of Albion Crown VCT
PLC, a fund investing in early stage technology companies and Principal at Agnosco Capital Ltd, where he
provides research and strategic advice to technology companies and their investors and Director of IS
Research Limited.
Skills and experience:
Ian has been recognised as a highly respected financial analyst in the technology sector, having twice been
voted as TechMARK Analyst of the Year and recognised by Debretts and The Sunday Times as a top 20
influencer in the UK technology sector. Ian has a degree in Accounting & Finance from Manchester
Metropolitan University.
Time commitment: 1-2 days a month
Quartix Technologies plc
28
Financial statements for the year ended 31 December 2024
7
Evaluate board performance based on clear and relevant objectives, seeking
continuous improvement
The focus in 2024 was on Board roles in the context of a Board development plan including a succession
plan for Executive Directors. This evaluation was accompanied by a wider review of the levels of
investment in the business, as well the senior management posts required to deliver on its the Group’s
strategy.
8
Promote a corporate culture that is based on ethical values and behaviours
At Quartix we believe the prosperity of our business and of the communities within which we operate
requires a commitment to ethical values and behaviours. We have therefore developed policies that enhance
all areas of our business in this regard.
Quartix cares about providing a customer experience that is remarkable. We want to keep our customers
happy, impressed and reassured. We want to create the positivity that leads to great reviews, repeat
purchases and customer referrals. To achieve that, our employees strive to make every interaction a great
one. We follow these principles:
Build meaningful connections.
Whilst dealing with any of our stakeholders, be they customers, partners, investors or employees, foremost
in our minds is building great, meaningful relationships. We are not a provider of arms-length transactional
services; we are here to listen, understand, support and deliver tangible benefits as best we can.
Keep things simple.
Whether it is our processes, communication, hardware or software, we strive to keep things simple. Fewer
moving parts make for clearer, more efficient and reliable operations. We don’t make our customers jump
through hoops to speak to us, nor do we make them study an article to understand its meaning. We get
straight to the incoming call, to the email in our inbox, to the point, and provide a fast, helpful and clear
response.
Treat everybody the same.
Whoever you talk to, whether internally or externally, their impression of the Quartix service should be the
same. We treat everyone equally, with respect, and remain transparent as a business.
Do the right thing
Quartix cares about doing what’s best for our customers and for each other. We own problems and solve
them, regardless of whether it’s our designated responsibility. With or without a corporate process, we will
strive to provide a satisfactory solution in every case.
Share your knowledge
Knowledge is valuable. Our customers, prospects and colleagues can all benefit from the knowledge that
we have to offer. Quartix and its staff have a whole host of skills, expertise and experience to share with
others and we are proud to do so. The culture of the Group is characterised by these values which are
communicated to staff through a number of mechanisms.
The Board believes that a culture that is based on the five core values is a competitive advantage and
consistent with fulfilment of the Group’s execution of its strategy.
Quartix Technologies plc
29
Financial statements for the year ended 31 December 2024
9
Maintain governance structures and processes that are fit for purpose and
support good decision-making by the Board
The Board provides strategic leadership for the Group and operates within the scope of a robust corporate
governance framework. Its purpose is to ensure the delivery of long-term shareholder value, which involves
setting the culture, values and practices that operate throughout the business, and defining the strategic
goals that the Group implements in its business plans. The Board defines a series of matters reserved for
its decision and has delegated some of its responsibilities to relevant Committees. The chair of each
committee reports to the Board on the activities of that committee.
The Audit Committee monitors the integrity of financial statements, oversees risk management and
control, monitors the effectiveness of internal controls and reviews external auditor independence.
Alison Seekings chairs the Audit Committee. The Committee exists to scrutinise and clarify any
qualifications, recommendations and observations within the audited accounts and report of the Company’s
auditor. When satisfied, the Committee presents the audited accounts and report to the Company’s Board
and reviews the effectiveness of resultant corrective and preventative measures.
The Remuneration Committee sets and reviews the compensation of Executive Directors including the
setting of targets and performance frameworks for cash and share-based awards.
It acts to ensure sound Corporate Governance with respect to Director and senior management
remuneration and meets once or twice in the year, as appropriate. The Committee functions with the
objective of attracting, retaining and motivating the executive management of the Company and ensuring
they are rewarded in a fair and responsible manner for their contribution to the success of the Group.
The role of the Committee is to determine and agree with the Board the framework or broad policy for the
remuneration of the Company’s Chairman and Executive Directors, including pension rights and
compensation payments. It also recommends and monitors the level and structure of remuneration for
senior management. When setting the remuneration policy, the Committee reviews and considers the pay
and employment conditions across the Group, especially when determining salary increases.
Andrew Walters chairs the Remuneration Committee and where there is a decision to be made around
Andrew Walters own remuneration package, this is reserved for the other members of the remuneration
committee to discuss without Andrew Walters present.
The Nominations Committee was chaired by Andrew Walters and is now chaired by Ian Spence
following his appointment to the Board. The Committee reviews the structure, size and composition of the
Board to ensure the leadership of the Group is the most proficient to facilitate the Group’s ability to
effectively compete in the marketplace. It makes recommendations to the Board regarding the continued
suitability of any Director, the re-election by shareholders of any Director under the ‘retirement by rotation’
provisions in the Company’s Articles of Association, and succession planning for Directors and other
Senior Executives.
Quartix Technologies plc
30
Financial statements for the year ended 31 December 2024
9
Maintain governance structures and processes that are fit for purpose and
support good decision-making by the Board (continued)
The Chairman has overall responsibility for corporate governance and in promoting high standards
throughout the Group. He leads and chairs the Board, ensuring that committees are properly structured
and operate with appropriate terms of reference, ensures that performance of individual Directors, the
Board and its committees are reviewed on a regular basis, leads in the development of strategy and setting
objectives, and oversees communication between the Group and its shareholders.
The Chairman provides coherent leadership and management of the Group and leads the development of
objectives, strategies and performance standards as agreed by the Board. He also monitors, reviews and
manages key risks and strategies with the Board, ensures that the assets of the Group are maintained and
safeguarded, leads on investor relations activities to ensure communications and the Group’s standing with
shareholders and financial institutions is maintained, and ensures that the Board is aware of the views and
opinions of employees on relevant matters.
At present Andrew Walters fulfils both the role of the Chairman and the CEO on the Board.
The Executive Director is responsible for implementing and delivering the strategy and operational
decisions agreed by the Board, making operational and financial decisions required in the day-to-day
operation of the Group, providing executive leadership to managers, championing the Group’s core values
and promoting talented management.
The Independent Non-Executive Directors contribute independent thinking and judgement through
the application of their external experience and knowledge, scrutinise the performance of management,
provide constructive challenge to the Executive Directors and ensure that the Group is operating within
the governance and risk framework approved by the Board.
The Company Secretary is responsible for providing clear and timely information flow to the Board and
its committees and supports the Board on matters of corporate governance and risk.
The key matters reserved for the Board are:
•
Setting long-term objectives and commercial strategy.
•
Approving annual budgets.
•
Changing the share capital or corporate structure of the Group.
•
Approving half-year and full-year results and reports.
•
Approving dividend policy and the declaration of dividends.
•
Ensuring a satisfactory dialogue with shareholders.
•
Approving major investments, disposals, capital projects or contracts.
•
Approving resolutions to be put to general meetings of shareholders and the associated documents
or circulars.
•
Approving changes to the Board structure.
The Board has approved the adoption of the QCA Code as its governance framework against which this
statement has been prepared and will monitor the adoption of the 2023 code and revise its governance
framework as appropriate as the Group evolves.
The Board will continue to monitor its governance structures and will take action as appropriate to develop
and enhance its governance functions as the Group evolves.
Quartix Technologies plc
31
Financial statements for the year ended 31 December 2024
10
Communicate how the Company is governed and is performing by maintaining a
dialogue with shareholders and other relevant stakeholders
In addition to the investor relations activities described previously, the Group communicates its governance
and performance with shareholders through the annual report and accounts, half-yearly trading updates,
the AGM, and investor meetings. An Audit Committee Report, Directors’ Remuneration Report and
Environmental, Social and Governance (“ESG”) Report are included in the annual report.
Quartix Technologies plc
32
Financial statements for the year ended 31 December 2024
Audit Committee Report
For the year ended 31 December 2024, the Audit Committee was chaired by Alison Seekings and
membership is limited to the Independent Non-Executive Directors.
The Committee exists to scrutinise and clarify any qualifications, recommendations and observations within
the audited accounts and report of the Company’s auditor. When satisfied, the Committee presents the
audited accounts and report to the Company’s Board and reviews the effectiveness of resultant corrective
and preventative measures.
Main responsibilities
In performing this function, the key duties of the Committee are to:
•
Monitor the integrity of the financial statements of the Group and any formal announcement
relating to its financial performance
•
With regards to financial reporting, review and challenge the consistency of accounting policies,
the use of accounting methods over alternatives, whether the Group has followed appropriate
accounting standards, the clarity of disclosure, and all material information relating to the audit and
risk management
•
Review the basis for the going concern statement in light of the financial plans and reasonably
possible scenarios especially considering industry wide and macro-economic factors that could
impact the business
•
Monitor the adequacy and effectiveness of the Group’s internal financial controls, including the
internal control and risk management systems.
•
Ensure that the Group’s arrangements for its employees and contractors to confidentially raise
concerns about possible wrongdoing allow proportionate and independent investigation and
appropriate follow up action.
•
Consider the need to implement an internal audit function.
•
Make recommendations to the Board and the Company’s shareholders regarding the appointment,
re-appointment, and removal of the Company’s external auditor. It ensures that at least once every
ten years the audit services contract is put out to tender to enable the Committee to compare the
quality and effectiveness of the services provided by the incumbent auditor.
•
Oversee the Company’s relationship with the external auditor.
•
Considering if the Annual Report and Accounts, when taken as a whole, is fair, balanced and
understandable.
Auditor
PKF Littlejohn LLP (PKF) was reappointed as the Company’s auditor at the 2024 AGM. The Audit
Committee monitors arrangements to ensure the independence of the auditor. The PKF partner is in their
fourth year this year and will retire by rotation after the 2026 AGM. No services other than audit have been
provided by PKF or any of its significant affiliates.
The Audit Committee overseas the plan for the statutory audit and reviews the auditor’s assessment of the
principal risks, proposed scope of work, audit approach and materiality. The Audit Committee has the
opportunity to review and challenge the audit plan and discuss the findings arising which includes feedback
on the effectiveness of internal controls. The Audit Committee seeks to ensure sufficient rigour is applied
during the audit process.
The Audit Committee reviews the Annual Report and Accounts to ensure they are fair, balanced and
understandable and that they provide the level of information useful to shareholders to enable them to
assess the Company’s performance and business model.
Quartix Technologies plc
33
Financial statements for the year ended 31 December 2024
Directors’ Remuneration Report
The Remuneration Committee functions with the objective of attracting, retaining and motivating the
executive management of the Company and ensuring they are rewarded in a fair and responsible manner
for their contribution to the success of the Group.
Remuneration of Executive Directors
In 2024, the Executive Directors’ remuneration packages comprised of a salary, a performance related
bonus scheme and the opportunity to enrol in the Group’s selected auto-enrolment pension scheme. See
below for a breakdown of the Directors’ remuneration packages during the year.
Directors’ detailed emoluments and compensation (audited)
2024 (£)
2023 (£)
Salary
Bonus
Pension
Total
Total
Executive
Andrew Walters1
50,000
-
-
50,000
13,269
Directors
Richard Lilwall2
-
-
-
-
170,837
Emily Rees3
118,253
-
1,385
119,638
154,884
Laura Seffino4
-
-
-
-
69,010
168,253
-
1,385
169,638
408,000
Non-
Executive
Directors
Paul Boughton5
-
-
-
-
72,092
David Warwick6
-
-
-
-
44,000
Andrew Walters 1
-
-
-
-
7,077
Russell Jones7
-
-
-
-
45,662
Alison Seekings8
45,000
-
-
45,000
4,269
Ian Spence9
39,058
-
-
39,058
-
84,058
-
-
84,058
173,100
1 Retired from Quartix Technologies plc Non-Executive Director role on 24 March 2023 and rejoined the Board as Chairman on
26 September 2023 and became Executive Chairman on 10 October 2023 following Richard Lilwall’s resignation
2 Resigned on 10 October 2023 and highest paid Director for 2023, not included in his salary is £30k gratuity on his resignation
3 Resigned from the Board on 26 March 2024. Included in both salary figures is a benefit in kind and in 2024 not included in her
salary is £25k gratuity on resignation
4 Stepped down from the Board on 7 July 2023, but remains an employee of the Company
5 Resigned from the Board on 25 September 2023
6 Resigned from the Board on 26 November 2023
7 Resigned from the Board on 26 November 2023
8 Appointed to the Board on 28 November 2023
9 Appointed to the Board on 19 December 2024
Quartix Technologies plc
34
Financial statements for the year ended 31 December 2024
Directors Bonus Schemes
Further to the resignation of Emily Rees as Executive Director, no director management incentive scheme
is operational.
Directors and their interests in shares
Ordinary shares £0.01 each
Year ended 31 December
2024
2023
Executive Directors
Emily Rees
n/a
-
Andrew Walters
10,861,609
10,861,609
10,861,609
10,861,609
Non-Executive Directors
Alison Seekings
-
-
Ian Spence
-
n/a
10,861,609
10,861,609
Directors and employees share options
There were no share options granted to Directors of the Company, and no share options exercised or share
options outstanding held by Directors of the Company at 31 December 2024.
Non-Executive Directors
A Non-Executive Director is typically expected to serve two three-year terms but may be invited by the
Board to serve for an additional period. The current Non-Executive Directors have entered into service
contracts for a three-year term. Any term renewal is subject to Board review and AGM re-election.
Date of contract
Unexpired period
at date of report
Alison Seekings
28 November 2023
20 months
Ian Spence
19 February 2024
24 months
Andrew Walters
Chairman, Remuneration Committee
Quartix Technologies plc
35
Financial statements for the year ended 31 December 2024
Environmental, Social and Governance (“ESG”) Report
The Board collectively provide oversight to ensure the Group’s strategy and vision are aligned with agreed
ESG metrics so Quartix, beyond the core environmental benefits of their product, contribute positively in
all territories that it operates.
The Board of Directors reaffirms its unwavering commitment to Environmental, Social, and Governance
(ESG) principles in the Group’s annual operations. The Group have integrated ESG considerations into
its core strategy, risk management, and decision-making processes. The main Board of Directors and the
Operating Board provides robust oversight of our sustainability initiatives, ensuring alignment with long-
term business objectives. The Group continues to enhance its ESG reporting practices in order to adhere
to globally recognized frameworks to provide transparent and accurate disclosures to its stakeholders. The
Group remains focused on driving positive environmental and social impact while maintaining the highest
standards of corporate governance
Streamlined Energy and Carbon Reporting
2022 was Quartix’s baseline for future year-on-year reporting with regard to all ESG KPIs. The carbon
reporting included in the report for year ended 31 December 2024 includes Scope 1, direct emissions and
Scope 2, indirect emissions from the electricity purchased and used. The Group is actively advancing its
efforts to measure and manage Scope 3 and market-based Scope 2 emissions. It is seeking to implement
data collection systems and refining methodologies to ensure comprehensive and accurate reporting of its
environmental metrics in upcoming annual disclosures. This strategic initiative underscores our
commitment to transparency and our dedication to reducing our overall carbon footprint across the value
chain where possible.
While Quartix has been awarded the LSE’s Green Economy Mark, in recognition of the business generating
at least 50% of its total annual revenue from products that contribute towards the transition to a low carbon
economy, the Board recognises that there will still be a journey to have a greater focus internally on
sustainability, and to minimise Quartix’s environmental footprint by reducing carbon emissions.
Quartix Technologies plc
36
Financial statements for the year ended 31 December 2024
Streamlined Energy and Carbon Reporting (continued)
The data below relates to UK emissions for the twelve-month period ending 31 December 2024.
2024
2023
Variance
Energy consumption (kWh) 1
Scope 1: Combustion of fuel and operation
of facilities
Natural gas
-
-
-
Direct transport
37,011
47,154
(22%)
Total Scope 1
37,011
47,154
(22%)
Scope 2: Electricity purchased3
Total electricity
98,811
109,652
(10%)
Total scope 1 and 2 energy consumption
135,822
156,806
(13%)
Greenhouse gas (GHG) emissions
(tonnes CO2e) 2
Scope 1: Combustion of fuel and operation
of facilities
Natural gas
-
-
-
Direct transport
9
11
(22%)
Total Scope 1
9
11
(22%)
Scope 2: Electricity purchased
Location Based
20
22
(10%)
Location based total scope 1 and 2
emissions
29
33
(14%)
Intensity metric assessment (tonnes
CO2e/£m revenue) 1
Intensity ratio
0.9
1.1
(20%)
1 Energy from electricity, natural gas and direct transport fuel have been included. Quartix has used the conversion factors
published in the 2024 Defra GHG conversion factors for company reporting for both 2023 and 2024.
2 We have used the GHG Protocol Corporate Accounting and Reporting Standards (Revised) methodology to calculate our
emissions. No mandatory emissions have been excluded.
3 Where estimates were provided from energy providers in the prior year, this is updated in the current year for actual energy usage.
Social and Community Reporting
Quartix’s relationships with employees, suppliers and communities are important factors for how the
business operates, with a commitment to creating a great place to work which celebrates diversity and
inclusion, and where health and wellbeing is prioritised and able to make a positive difference to the
societies in which the business operates.
The business continues to support and develop staff who wish to study for further qualifications. A key
focus continues to be in creating a greater curriculum of either external or internal learning and development
courses to support staff development. In 2024 the majority of the training hours undertaken by staff was
for management training to upskill for development roles and cyber security training. In 2024 the HR team
began work on incorporating both internal and external training hours into a training matrix to better report
the training hours for appraisal sessions. A better system of capturing all the training is the focus for 2025,
to ensure complete coverage of all training sessions booked by managers across the business for staff in
their team.
2024
2023
Staff training hours - external
575
700
The business continues to support staff through ongoing mental health support, with a key management
group having gone through the i-act mental health and wellbeing programme for understanding and
managing mental health and wellbeing in the workplace. Further work on wellbeing across a range of topics
are a focus in the medium term in order to support staff further.
Quartix Technologies plc
37
Financial statements for the year ended 31 December 2024
Social and Community Reporting (continued)
The business’ staff turnover continues to be a focus area in 2025.
As well as supporting Quartix staff, a growing focus is on supporting the communities that Quartix staff
operate in. While many staff in the business personally commit voluntary time to community and charitable
organisations, there is currently no corporate scheme to facilitate this, though Quartix’s Social Committee
is looking to review this for the business’ main base of operations in Newtown, Wales. The Social
Committee is composed of a key group of staff in Newtown that deliver on local and national charity
initiatives in order to support communities.
2024
2023
Variance
Voluntary staff turnover (%)
18
17
(1)
Share of temporary staff (%)
3
4
1
Governance Reporting
Quartix recognises the importance of strong governance practices in ensuring the long-term success and
sustainability of the business. Our governance framework is designed to promote ethical behaviour,
accountability, and transparency, and to align the interests of the Company with those of its stakeholders
(please refer to the Corporate Governance statement pages 24-25 for more details on this). The Group
makes no political contributions.
In addition to the governance provided by the Board, Quartix’s executive management team, called the
Operations Board, is responsible for the day-to-day operations of the business and implementing the
strategies and plans that are approved by the Board of Directors. The team is comprised of experienced
and knowledgeable individuals who have a strong track record of delivering results.
Quartix is committed to operating in an ethical and responsible manner and complying with all relevant
laws and regulations, and has established an ethics and compliance program to ensure that all employees
are aware of their obligations and are equipped to make ethical decisions. The Group has incurred no fines
for inappropriate business practices.
Leadership diversity
The Group recognises the importance of diversity in skills, experience, gender, culture and ethnicity in
providing strength in leadership. The Board continues to support the leadership and development of the
Operations Board and notes the successful promotion and development of individuals into this team. Three
out of the nine members of the Operations Board are female. The gender mix of the Board is 67% male/
33% female from March 2024.
Quartix Technologies plc
38
Financial statements for the year ended 31 December 2024
Directors’ Report
The Directors present their annual report and the financial statements of the Company for the year ended
31 December 2024.
Principal activity
The principal activity of the Group during the year was the design, development, marketing and delivery of
vehicle telematics services. The Group has overseas subsidiaries incorporated in France and the USA and
a subsidiary in Germany. The Parent Company is incorporated and domiciled in the UK. The registered
office is No.9 Journey Campus, Castle Park, Cambridge, CB3 0AX.
Research and development
Please see the Strategic Report on page 11 for further information about the Group’s approach to research
and development.
Future developments
The Company’s intentions regarding investment and business development can be found under Capacity
for future growth on page 12.
Proposed dividend
In the year ending 31 December 2024, the Board paid an interim dividend of 1.50p (2023: 1.50p) per
ordinary share. This totalled £0.7m, which was paid on 30 September 2024 to shareholders on the register
on 30 August 2024.
The Board is recommending a final dividend of 3.00p per share, with no supplementary dividend,
amounting to approximately £1.4m in aggregate and giving a total dividend for the year equivalent to 4.50p
per share. If this is approved at the forthcoming AGM on 31 March 2025, the final dividend will be paid
on 30 April 2025 to shareholders on the register as at 4 April 2025.
Major interest in shares
On 28 February 2025, the Company had been notified that seven parties had holdings of 3% or more in
the ordinary share capital of the Company. The number of ordinary shares and the percentage of the total
shares held by each party is outlined below.
Number of £0.01 shares1
% of total
Andrew Walters2
10,861,609
22.44
Liontrust Investment Partners LLP
5,617,329
11.61
Sanford Deland Asset Management Ltd
4,440,000
9.18
Charles Stanley Group plc
4,348,427
8.99
Andrew Kirk
4,009,853
8.29
Schroders PLC
3,062,971
6.33
William Hibbert
2,663,000
5.50
Kenneth Giles
1,871,800
3.87
1 Based on the most recent available data to the Company
2 Includes shares held as family interests or by virtue of position as beneficiary or potential beneficiary of certain trusts
Quartix Technologies plc
39
Financial statements for the year ended 31 December 2024
Directors
The Non-Executive Directors who held office during the year are listed below:
•
Alison Seekings
•
Ian Spence
(from 19 February 2024)
The Executive Directors who held office during the year are listed below:
•
Emily Rees
(until 26 March 2024)
•
Andrew Walters
All Executive Directors have service agreements with the Company terminable by either party upon the
minimum notice period being met. The minimum notice period is 6 months for all Executive Directors.
The Company’s Articles of Association require all Directors to stand for re-election each year at the AGM.
The next AGM will take place on 31 March 2025.
Going concern
Inflation, increased interest rates and global trade uncertainties continue to adversely disrupt the global
economic situation in 2024, in addition to other wider economic factors causing adverse economic
pressures. The Company continues to take appropriate action to monitor, address and mitigate the
uncertainties and increased risks facing the Company as a result and have taken these additional
uncertainties into account in assessing the going concern position.
The Board takes all reasonable steps to review and consider any factors that may affect the ability of the
Group to continue as a going concern. Included in the going concern assessment, was the review of the
cash impact to the business over the next 2 years for the upgrade of units in France from 2G to 4G. In
order to minimise the impact of attrition and to manage the cash flow impact of replacing these units over
the next 2 years, the Company started in January 2024 to proactively replace the 2G units with 4G units.
The replacement provision is expected to result in a reduced dividend per share for the duration of the
replacement programme, but the strength of the Group’s recurring business model allows the Group to
fund this replacement programme from cash reserves, without having to financially leverage itself with a
financing alternative from the bank.
The Group’s forecasts and projections, taking account of reasonably possible changes in trading
performance, show that the Group is able to generate sufficient liquidity. The Group enjoys a strong income
stream from its fleet subscription base while current liabilities include a substantial provision for deferred
revenue which is a non-cash item.
In addition to the base case scenario, the Board reviewed a further scenario as part of its going concern
assessment. This additional scenario considered the impact on the Group if for both 2025 and 2026 there
is a reduction in new unit subscription growth due to a reduction in new business and repeat business from
existing customers as the economic pressures in the market dictate they cannot increase their fleet sizes,
gross attrition rate increases again as a result of economic pressures in the market resulting in a higher
number of customers going bankrupt, or having to reduce their fleet sizes at renewals dates. Additionally,
an increase in the inflation has been considered as a sensitivity, given the elevated inflation rate in the UK
and businesses being forced to shop around to make more economic decisions for their own profit/cash
positions. This scenario was not considered likely but was included in the assessment.
After assessing the forecasts and liquidity of the business, including the going concern scenarios, for the
next two calendar years and the longer-term strategic plans, the Directors have a reasonable expectation
that the Group has adequate resources to continue in operational existence for the foreseeable future. The
Group therefore continues to adopt the going concern basis in preparing consolidated financial statements.
Quartix Technologies plc
40
Financial statements for the year ended 31 December 2024
Directors’ responsibilities statements
The Directors are responsible for preparing the Strategic Report, Remuneration Report, Directors’ Report
and the financial statements in accordance with applicable law and regulations.
Company Law requires the Directors to prepare financial statements for each financial year. Under that law
the Directors have elected to prepare the consolidated financial statements in accordance with UK-adopted
International Accounting Standards (UK-adopted IAS) and have elected to prepare the Parent Company
financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards and applicable laws including FRS 101 Reduced Disclosure Framework).
Under Company Law the Directors must not approve the financial statements unless they give a true and
fair view of the state of affairs and profit or loss of the Company and Group for that period.
In preparing these financial statements, the Directors are required to:
•
Select suitable accounting policies and apply them consistently
•
Make judgements and estimates that are reasonable and prudent
•
State whether applicable UK-adopted IAS have been followed, subject to any material departures
disclosed and explained in the consolidated financial statements
•
Prepare the financial statements on the going concern basis unless it is inappropriate to presume
that the Group will continue in business
•
State whether applicable UK Accounting Standards have been followed, subject to any material
departures disclosed and explained in the Company financial statements
The Directors are responsible for keeping adequate accounting records that are sufficient to show and
explain the Group’s transactions and disclose with reasonable accuracy at any time the financial position of
the Group and enable them to ensure that the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The Directors confirm that:
•
•
so far as each Director is aware, there is no relevant audit information of which the
company’s auditor is unaware; and
•
•
the Directors have taken all the steps that they ought to have taken as directors in order
to make themselves aware of any relevant audit information and to establish that the company’s
auditor is aware of that information.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the company’s website. Legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in other jurisdictions.
Financial risk management policies and objectives
The Group manages its key financial risks as follows. Principal risks and uncertainties are considered in
the strategic report on pages 15-16.
Credit risk
The principal credit risk relates to trade receivables and is mitigated, where possible, by third party credit
clearance for new customers and collection by direct debit, or similar. The Group seeks to manage credit
risk associated with cash deposits by using banks with high credit ratings assigned by international credit
rating agencies.
Currency risk
This is managed by seeking to match currency inflows and outflows.
Quartix Technologies plc
41
Financial statements for the year ended 31 December 2024
Directors’ and officers’ liability insurance
The Company maintains insurance cover for the Directors and key personnel against liabilities which may
be incurred by them while carrying out their duties.
Auditors
The Directors have individually pursued all steps that they ought to have taken in their roles as Directors
to ensure they are aware of any relevant audit information and that such information has been relayed to
the Company’s auditors. The Directors each confirm that there is no relevant information of which the
Company’s Auditors are unaware.
The Auditor, PKF Littlejohn LLP, will be proposed for reappointment in accordance with section 485 of
the Companies Act 2006.
Approved by the Board of Directors and signed on behalf of the Board on 28 February 2025.
Andrew Walters
Executive Chairman
Quartix Technologies plc
42
Financial statements for the year ended 31 December 2024
Independent Auditor's Report to the Members of Quartix
Technologies plc
Opinion
We have audited the financial statements of Quartix Technologies Plc (the ‘Parent Company’) and its
subsidiaries (the ‘Group’) for the year ended 31 December 2024 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated and Parent Company Statements of Financial
Position, the Consolidated and Parent Company Statements of Changes in Equity, the Consolidated
Statement of Cash Flows and notes to the financial statements, including significant accounting policies.
The financial reporting framework that has been applied in the preparation of the Group financial
statements is applicable law and UK-adopted international accounting standards. The financial reporting
framework that has been applied in the preparation of the Parent Company financial statements is
applicable law and United Kingdom Accounting Standards, including FRS 101 Reduced Disclosure
Framework (United Kingdom Generally Accepted Accounting Practice).
In our opinion:
•
the financial statements give a true and fair view of the state of the Group’s and of the Parent
Company’s affairs as at 31 December 2024 and of the Group’s profit for the year then ended;
•
the Group financial statements have been properly prepared in accordance with UK-adopted
international accounting standards;
•
the Parent Company financial statements have been properly prepared in accordance with UK-
adopted international accounting standards and as applied in accordance with the provisions of the
Companies Act 2006; and
•
the financial statements have been prepared in accordance with the requirements of the Companies
Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our report. We are independent of the
Group and Parent Company in accordance with the ethical requirements that are relevant to our audit of
the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities, and
we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis
of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors’
assessment of the Group’s and Parent Company’s ability to continue to adopt the going concern basis of
accounting included obtaining a cashflow forecast covering at least a twelve-month period from the
approval of the financial statements, holding discussions with management around the sensitivities included
within the budget such as unit numbers, attrition rates and price erosion, assessing the reasonableness of
projected cashflows and working capital assumptions and critically evaluating the revenue and cost
projections by completing sensitivities analysis underlying the cash flow model.
Quartix Technologies plc
43
Financial statements for the year ended 31 December 2024
Conclusions relating to going concern (continued)
Based on the work we have performed, we have not identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast significant doubt on the Group's or Parent
Company’s ability to continue as a going concern for a period of at least twelve months from when the
financial statements are authorised for issue.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in
the relevant sections of this report.
Our application of materiality
We apply the concept of materiality both in planning and performing the audit, and in the evaluation of the
effect of identified misstatements on the audit and of uncorrected misstatement, if any, on the financial
statement in forming the opinion in the auditor’s report.
We define materiality as the magnitude of misstatement in the financial statements that, individually or in
aggregate, could reasonably be expected to influence the economic decisions of the users of the financial
statements. We use materiality in determining the nature, timing and extent of our audit work.
Our overall materiality for the group is £486,000 (2023: £298,400) which represents 1.5% (2023: 1%) of
turnover. Turnover is considered to be the most appropriate benchmark because the group is a
commercially focussed organisation and turnover is a key financial measure for the directors and
shareholders.
Parent overall materiality for Quartix Technologies Plc is £367,000 (2023: £166,000) which represents
1.85% (2023: 1%) of the Parent company’s net assets. The benchmark of net assets is chosen because the
parent holds subsidiaries and consider the net asset the key financial measure for directors and shareholders.
We set performance materiality at an amount less than the overall materiality for the financial statements
as a whole to reduce to an appropriately low level the probability that the aggregate of uncorrected and
undetected misstatements exceeds materiality for the financial statements as a whole.
Our performance materiality for the group is £364,500 (2023: £223,000), which is 75% (2023: 75%) of
overall materiality. Our performance materiality for the parent company is £255,000 (2023: £124,500)
which was 70% (2023: 75%) of overall materiality. We have selected 75% and 70% respectively based on
our risk assessment of the group and parent company and our assessment of the group’s and parent
company’s control environment.
We report to the directors all corrected and uncorrected misstatements we identified through our audit with
a value in excess of £24,300 (2023: £14,920 ) for the group, and £15,000 (2023: £8,300 ) for the parent
company as well as other audit misstatements below that threshold that we believe warranted reporting on
qualitative grounds.
Our approach to the audit
Our audit is risk based and designed to focus our efforts on the areas of greatest risk and material
misstatement, aspects subject to significant management judgement as well as greatest complexity, risk and
size.
In designing our audit, we determined materiality and assessed the risk of material misstatement in the
Group and Parent Company financial statements. We looked at areas involving significant accounting
estimates and judgements by the directors and considered future events that are inherently uncertain, in
particular the valuation of goodwill and the valuation of investments in subsidiaries for the parent company.
We also assessed the risk of management override of internal controls, among other matters such as revenue
recognition (see Key audit matter section below), in consideration of whether there was evidence of bias
that represented a risk of material misstatement due to fraud.
Quartix Technologies plc
44
Financial statements for the year ended 31 December 2024
Of the Group’s 5 components, including the Parent Company, 3 of the components were subject to full
scope audits for Group purposes. We performed a full scope audit using component materiality on the
financial information of Quartix Technologies Plc, Quartix Limited and Quartix SAS.
The remaining components were subject to a specific scope audit. These components contained only
balances that eliminated on consolidation, or specific balances material to the Group financial statements.
We performed a limited scope review for Quartix Inc and Konetik Deutschland GmbH.
Of the 3 components subject to full scope audits, Quartix SAS was located in France. The component was
audited by a firm within the PKF network operating under our instruction. The remaining components
were audited directly by the Group audit team. We interacted regularly with the component audit team
during all stages of the audit and we were responsible for the scope and direction of the audit process. This
gave us appropriate evidence for our opinion on the Group and Parent Company financial statements.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period and include the most significant assessed risks of
material misstatement (whether or not due to fraud) we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the
engagement team. These matters were addressed in the context of our audit of the financial statements as
a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matter
How our scope addressed this matter
Revenue Recognition (Notes 1 and 3)
We identified revenue recognition as an audit
area susceptible to a risk of misstatement due
to fraud.
As detailed in Notes 1 and 3 to the financial
statements, the Group’s principal revenue
stream relates to the provision of telematics-
based fleet and vehicle management solutions
to customers. The Group’s activities of
supplying telematic units and providing
telematics services are considered to be a
single performance obligation which is
satisfied over a period of time. The Group also
performs
support
services.
These
are
considered to be a separate performance
obligation for which a separate charge and
invoice is raised. Revenue is recognised over
the period that services are provided.
Given the nature of the Group’s revenue
being high volume of low value transactions
and of high quantum, we identified that
revenue was deemed to be a significant risk
and a key audit matter.
Our audit work in this area included:
•
Assessing whether revenue recorded in line
with the Group’s accounting policy and
whether the accounting policy was compliant
with International Financial Report Standard 15
Revenue from Contracts with Customers (IFRS 15);
•
Testing a sample of sales invoices and agreeing
the numbers of units and contract prices to
agreements. In addition, for a sample of
selected invoices subsequent cash receipts
testing was performed;
•
Testing credit notes raised post year end to
determine if they related to the revenue
recognised during the year to ensure revenue
recognised
during
the
year
was
not
subsequently being reversed; and
•
Performing controls testing over data inputs for
the invoicing process.
Quartix Technologies plc
45
Financial statements for the year ended 31 December 2024
Key audit matters (continued)
Other information
The other information comprises the information included in the annual report, other than the financial
statements and our auditor’s report thereon. The directors are responsible for the other information
contained within the annual report. Our opinion on the Group and Parent Company financial statements
does not cover the other information and, except to the extent otherwise explicitly stated in our report, we
do not express any form of assurance conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be
materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material misstatement in the financial statements
themselves. If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.
Key Audit Matter
How our scope addressed this matter
Deferred Revenue (Note 20)
We identified deferred income as a significant
class of transactions where there was risk of
material misstatement due to fraud.
As detailed in note 20 to the financial
statements, the Group raises invoices in
advance and classifies deferred income as
contract liabilities.
Under IFRS 15, the Group’s activities of
supplying telematics units and providing
telematics services are considered to be a
single performance obligation which is
satisfied over a period of time. The deferred
income is driven by the contract terms and
numbers of units and as a significant balance,
presents a risk of material misstatement and as
such was deemed to be a significant risk and
key audit matter.
Our audit work in this area included:
For fleet customers:
•
Recalculating, for a sample of sales invoices, the
appropriate portion of revenue to defer based
on the contractual billing terms agreed with the
customer and comparing this to the actual
amount deferred.
•
Validating, on a sample basis, the free periods
to customer contracts and performing a
recalculation of the adjustment.
•
Evaluating the effectiveness of the design and
implementation of the systems and related
controls
Quartix Technologies plc
46
Financial statements for the year ended 31 December 2024
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the strategic report and the directors’ report for the financial year for
which the financial statements are prepared is consistent with the financial statements; and
•
the strategic report and the directors’ report have been prepared in accordance with applicable legal
requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the Parent Company and their
environment obtained in the course of the audit, we have not identified material misstatements in the
strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
•
adequate accounting records have not been kept by the Parent Company, or returns adequate for
our audit have not been received from branches not visited by us; or
•
the Parent Company financial statements are not in agreement with the accounting records and
returns; or
•
certain disclosures of directors’ remuneration specified by law are not made; or
•
we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the
preparation of the Group and Parent Company financial statements and for being satisfied that they give a
true and fair view, and for such internal control as the directors determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the Group and Parent Company financial statements, the directors are responsible for
assessing the Group and the Parent Company’s ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Group or the Parent Company or to cease operations, or have no
realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted
in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial
statements.
Quartix Technologies plc
47
Financial statements for the year ended 31 December 2024
Auditor’s responsibilities for the audit of the financial statements (continued)
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of
irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below:
•
We obtained an understanding of the Group and Parent Company and the sector in which they
operate to identify laws and regulations that could reasonably be expected to have a direct effect
on the financial statements. We obtained our understanding in this regard through discussions with
management and the application of our cumulative audit knowledge and experience of the sector.
•
We determined the principal laws and regulations relevant to the Group and Parent Company in
this regard to be those arising from UK-adopted international accounting standards, Companies
Act 2006, AIM Rules for Companies, QCA Corporate Governance Code and the relevant tax
compliance regulations in the jurisdictions in which the Group operates.
•
We designed our audit procedures to ensure the audit team considered whether there were any
indications of non-compliance by the Group and Parent Company with those laws and regulations.
These procedures included, but were not limited to:
o We obtained an understanding of the effectiveness of the Group’s overall control
environment and policies to monitor controls related to revenue recognition as well as,
contract assets and liabilities;
o We reviewed all the Group’s press releases, board minutes and performed a search of any
related information in the public domain;
o In addition, we completed audit procedures to conclude on the compliance of disclosures
in the annual report and financial statements with applicable reporting requirements; and
o We communicated relevant laws and regulations and potential fraud risks to all
engagement team members and remained alert to any indications of fraud or non-
compliance with laws and regulations throughout the audit.
•
We also identified the risks of material misstatement of the financial statements due to fraud. We
considered, in addition to the non-rebuttable presumption of a risk of fraud arising from
management override of controls, that that there was a risk of material misstatement in revenue
recognition and deferred income (see Key audit matters section above) as well as the potential for
management bias in relation to the valuation of goodwill and we addressed this by challenging the
key assumptions and judgements made by management when auditing that significant accounting
estimate.
•
As in all of our audits, we addressed the risk of fraud arising from management override of controls
by performing audit procedures which included, but were not limited to: the testing of journals;
reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any
significant transactions that are unusual or outside the normal course of business.
•
As part of our Group audit, we communicated with the component auditors, the fraud risks
associated with the Group and the need for the component auditors to address the risk of fraud
through their testing. To ensure that this is completed, we have reviewed component auditor
working papers in this area and obtained responses to our Group instructions from the component
auditor.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities,
including those leading to a material misstatement in the financial statements or non-compliance with
regulation. This risk increases the more that compliance with a law or regulation is removed from the events
and transactions reflected in the financial statements, as we will be less likely to become aware of instances
of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error,
as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial statements is located on the
Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms
part of our auditor’s report.
Quartix Technologies plc
48
Financial statements for the year ended 31 December 2024
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s
members those matters we are required to state to them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the
Company and the Company's members as a body, for our audit work, for this report, or for the opinions
we have formed.
Zahir Khaki (Senior Statutory Auditor)
15 Westferry Circus
For and on behalf of PKF Littlejohn LLP
Canary Wharf
Statutory Auditor
London E14 4HD
28 February 2025
Quartix Technologies plc
49
Financial statements for the year ended 31 December 2024
Consolidated Statement of Comprehensive Income
Year ended 31 December
2024
2023
2023
2023
Notes
Before
Adjustments
Adjustments
After
Adjustments
£’000
£’000
£’000
£’000
Revenue
3
32,402
29,882
-
29,882
Cost of sales
(9,886)
(9,145)
(3,759)
(12,904)
Gross profit
22,516
20,737
(3,759)
16,978
Sales & Marketing expenses
(7,105)
(6,366)
-
(6,366)
Administrative expenses
(9,020)
(9,285)
-
(9,285)
Impairment
11
-
-
(2,695)
(2,695)
Fair value gain
73
-
312
312
Operating profit/(loss)
6,464
5,086
(6,142)
(1,056)
Finance income receivable
7
2
10
-
10
Finance costs payable
8
(153)
(31)
-
(31)
Profit/(Loss) for the year before
taxation
4
6,313
5,065
(6,142)
(1,077)
Tax expense
9
(1,547)
(771)
940
169
Profit/(Loss) for the year
4,766
4,294
(5,202)
(908)
Other Comprehensive income:
Items that may be reclassified
subsequently to profit or loss:
Exchange difference on translating
foreign operations
(14)
43
-
43
Other comprehensive (loss)/income
for the year, net of tax
(14)
43
-
43
Total comprehensive income
attributable to the equity
shareholders of Quartix
Technologies plc
4,752
4,337
(5,202)
(865)
Earnings per ordinary share (pence)
10
Basic
9.85
(1.88)
Diluted
9.78
(1.88)
.
Quartix Technologies plc
50
Financial statements for the year ended 31 December 2024
Consolidated Statement of Financial Position
31 Dec 2024
31 Dec 2023
Notes
£'000
£’000
Non-current assets
Goodwill
11
14,029
14,029
Property, plant and equipment
13
560
684
Deferred tax assets
22
737
1,144
Contract cost assets
15
1,125
894
Total non-current assets
16,451
16,751
Current assets
Inventories
14
1,732
1,411
Contract cost assets
15
5,045
4,550
Trade and other receivables
16
4,115
4,186
Cash and cash equivalents
17
3,101
2,380
Total current assets
13,993
12,527
Total assets
30,444
29,278
Current liabilities
Trade and other payables
18
4,029
3,955
Provisions
19
1,203
2,775
Contract liabilities
20
3,782
3,679
Current tax liabilities
369
557
9,383
10,966
Non-current liabilities
Lease liabilities
21
411
520
Non-current provisions
19
1,048
1,443
1,459
1,963
Total liabilities
10,842
12,929
Net assets
19,602
16,349
Equity
Share capital
23
484
484
Share premium account
23
6,332
6,332
Equity reserve
163
392
Capital redemption reserve
4,663
4,663
Translation reserve
(309)
(295)
Retained earnings
8,269
4,773
Total equity attributable to equity shareholders
of Quartix Technologies plc
19,602
16,349
Approved by the Board of Directors, authorised for issue and signed on behalf of the Board on 28 February
2025.
Andrew Walters
Executive Chairman
Quartix Technologies plc
51
Financial statements for the year ended 31 December 2024
Consolidated Statement of Changes in Equity
Share
capital
Share
premium
account
Capital
redemption
reserve
Equity
reserve
Translation
reserve
Retained
earnings
Total
equity
£’000
£,000
£’000
£’000
£’000
£’000
£’000
Balance at 31
December 2022
484
6,332
4,663
342
(338)
9,428
20,911
Shares issued
-
-
-
-
-
-
-
Increase in equity
reserve in relation to
options issued
-
-
-
78
-
-
78
Recycle of equity
reserve to P&L
-
-
-
(28)
-
28
-
Dividend paid
-
-
-
-
-
(3,775)
(3,775)
Transactions with
owners
-
-
-
50
-
(3,747)
(3,697)
Foreign currency
translation differences
(note 30)
-
-
-
-
43
-
43
Loss for the year
-
-
-
-
-
(908)
(908)
Total comprehensive
income
-
-
-
-
43
(908)
(865)
Balance at 31
December 2023
484
6,332
4,663
392
(295)
4,773
16,349
Shares issued
-
-
-
-
-
-
-
Increase in equity
reserve in relation to
options issued and
cancelled
-
-
-
(113)
-
66
(47)
Recycle of equity
reserve to P&L
-
-
-
(116)
-
116
-
Dividend paid
-
-
-
-
-
(1,452)
(1,452)
Transactions with
owners
-
-
-
(229)
-
(1,270)
(1,499)
Foreign currency
translation differences
(note 30)
-
-
-
-
(14)
-
(14)
Profit for the year
-
-
-
-
-
4,766
4,766
Total comprehensive
income
-
-
-
-
(14)
4,766
4,752
Balance at 31
December 2024
484
6,332
4,663
163
(309)
8,269
19,602
Quartix Technologies plc
52
Financial statements for the year ended 31 December 2024
Consolidated Statement of Cash Flows
2024
2023
Notes
£'000
£'000
Cash generated from operations
25
4,097
4,465
Taxes paid
(1,326)
(1,181)
Cash flow from operating activities
2,771
3,284
Investing activities
Additions to property, plant and equipment
(28)
(17)
Interest received
7
2
10
Acquisition of subsidiary, net of cash acquired
(176)
(1,986)
Cash flow used in investing activities
(202)
(1,993)
Cash flow from operating activities
after investing activities (free cash flow)
2,569
1,291
Financing activities
Repayment of lease liabilities
26
(166)
(172)
Proceeds from share issues
-
-
Dividend paid
(1,452)
(3,775)
Cash flow used in financing activities
(1,618)
(3,947)
Net changes in cash and cash equivalents
951
(2,656)
Cash and cash equivalents, beginning of year
2,380
5,063
Exchange differences on cash and cash equivalents
(230)
(27)
Cash and cash equivalents, end of year
17
3,101
2,380
Quartix Technologies plc
53
Financial statements for the year ended 31 December 2024
Notes to the Consolidated Financial Statements
1
Summary of significant accounting policies
Basis of accounting
These financial statements are consolidated financial statements for the Group consisting of Quartix
Technologies plc, a company registered in the UK, and all its subsidiaries. These consolidated financial
statements are for the year ended 31 December 2024 and are prepared in Sterling and are rounded to the
nearest thousand pounds (£’000). They have been prepared in accordance with UK-adopted International
Financial Reporting Standards (‘IFRS’) and with the requirements of the Companies Act 2006 applicable
to companies reporting under those standards.
These financial statements have been prepared under the historical cost convention. New Standards,
Amendments and Interpretations not adopted in the current year have not been disclosed as they are not
expected to have a material impact on the Group’s financial statements.
Basis of consolidation
The financial statements of subsidiaries are included in the consolidated financial statements from the date
that control commences until the date that control ceases. Control is achieved where the Company has
the power over an investee entity, exposure or rights to variable returns from the involvement in the
investee and the ability to use its power over the investee to affect the amount of the investors returns.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated income
statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.
Intra-group balances and any unrealised gains and losses or income and expenses arising from intra-group
transactions are eliminated in preparing the consolidated financial statements. A list of subsidiaries is
included in note 12.
Business combinations
Business combinations are accounted for using the acquisition method under the revised IFRS 3 Business
combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated
as the sum of the acquisition-date fair value of assets transferred, liabilities incurred, and the equity interests
issued by the Group, which includes the fair value of any asset or liability arising from a contingent
consideration agreement. Acquisition costs are expensed within administration expenses as incurred. The
Group recognises identifiable assets acquired and liabilities assumed including contingent liabilities in a
business combination regardless of whether they have been previously recognised in the acquiree’s
financial statements prior to the acquisition. Assets acquired and liabilities assumed are generally measured
at their acquisition-date fair values.
Going concern
Inflation, increased interest rates and global trade uncertainties continue to adversely disrupt the global
economic situation in 2024, in addition to other wider economic factors causing adverse economic
pressures. The Company continues to take appropriate action to monitor, address and mitigate the
uncertainties and increased risks facing the Company as a result and have taken these additional
uncertainties into account in assessing the going concern position.
The Board takes all reasonable steps to review and consider any factors that may affect the ability of the
Group to continue as a going concern. Included in the going concern assessment, was the review of the
cash impact to the business over the next 2 years for the upgrade of units from 2G to 4G in France. In
order to minimise the impact of attrition impact and to manage the cash flow impact of replacing these
units over the next 2 years, the Company started in January 2024 to proactively replace the 2G units with
4G units in France. The replacement provision is expected to result in a reduced dividend per share for the
duration of the replacement programme, but the strength of the Company’s recurring business model
allows the Company to fund this replacement programme from cash reserves, without having to financially
leverage itself with a financing alternative from the bank.
Quartix Technologies plc
54
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Going concern (continued)
The Group’s forecasts and projections, taking account of reasonably possible changes in trading
performance, show that the Group is able to generate sufficient liquidity. The Group enjoys a strong income
stream from its fleet subscription base while current liabilities include a substantial provision for deferred
revenue which is a non-cash item.
In addition to the base case scenario, the Board reviewed a further scenario as part of its going concern
assessment. This additional scenario considered the impact on the Company if for both 2025 and 2026
there is a reduction in new unit subscription growth due to a reduction in new business and repeat business
from existing customers as the economic pressures in the market dictate they cannot increase their fleet
sizes, gross attrition rate increases again as a result of economic pressures in the market resulting in a higher
number of customers going bankrupt, or having to reduce their fleet sizes at renewals dates. Additionally,
an increase in the inflation has been considered as a sensitivity, given the elevated inflation rate in the UK
and businesses being forced to shop around to make more economic decisions for their own profit/cash
positions. This scenario was not considered likely but was included in the assessment.
After assessing the forecasts and liquidity of the business, including the going concern scenarios, for the
next two calendar years and the longer-term strategic plans, the Directors have a reasonable expectation
that the Group has adequate resources to continue in operational existence for the foreseeable future. The
Group therefore continues to adopt the going concern basis in preparing consolidated financial statements.
Revenue recognition
Revenue is the amount receivable for goods and services, excluding sales taxes, rebates, and trade discounts.
Revenue comprises the provision of telematics-based fleet and vehicle management solutions. Revenue is
recognised either at a point in time or over time, when (or as) the Group satisfies performance obligations
by transferring the promised goods or services to its customers.
Under IFRS 15, the Group must evaluate the separability of the promised goods or services based on
whether they are ‘distinct’. A promised good or service is ‘distinct’ if both:
•
the customer benefits from the item either on its own or together with other readily available
resources; and
•
it is ‘separately’ identifiable (i.e. the Group does not provide a significant service integrating,
modifying or customising it).
For the adoption of IFRS 15 the Group completed a detailed assessment of its sources of revenue and
concluded that the Group’s activities of supplying telematics units, installing telematics units and providing
telematics services are not distinct and that it has one single performance obligation. Consequently, the
Group does not recognise revenue separately for these goods and services; but recognises this revenue
together as the provision of vehicle telematics services.
The Group recognises contract liabilities for consideration received in respect of unsatisfied performance
obligations and reports these amounts as contract liabilities in the statement of financial position (see note
20).
If the Group satisfies a performance obligation before it received the consideration, the Group recognises
a receivable in its statement of financial position.
Fleet telematic services
Fleet customers enter into contracts typically with a commitment to purchase data services for 12 months.
The price is fixed for the contract term. Generally, invoices are raised quarterly in advance, with payment
due within 30 days. Quartix satisfies its performance obligations over time as services are rendered.
Quartix Technologies plc
55
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Revenue recognition (continued)
Fleet telematic services (continued)
If promotional offers include any free months, then total revenue is allocated on a straight line basis over
the whole period (including the free period) of data services in accordance with the performance
obligations, since the customer benefits from the Group’s services evenly throughout the contract term and
receives the benefit of the services as they are made available.
Insurance telematic services
For insurance telematic services, the customer commits to purchase data services for 12 months, with
revenue recognised over the 12 month period on a straight line basis, since the customer benefits from the
Group’s services evenly throughout the contract.
Support Services
Quartix performs additional services, such as removing, upgrading or transferring units to alternative
vehicles, and theft tracking. These are considered to be separate performance obligations for which a
separate charge and invoice is raised. Revenue is recognised once the additional service obligation has been
delivered to the customer, at a point in time.
Contract Cost Assets
The Group incurs costs to fulfil its customer contracts, which include commission costs, equipment costs,
installation costs and carriage costs amongst other costs. Costs to fulfil a customer contract are divided
into:
•
costs that give rise to an asset; and
•
costs that are expensed as incurred.
When determining the appropriate accounting treatment for such costs, the Group firstly considers any
other applicable standards. If those standards preclude capitalisation of a particular costs, then an asset is
not recognised under IFRS 15.
If other standards are not applicable to costs to fulfil a customer contract, the Group applies the following
criteria which, if met, result in capitalisation of costs that:
•
directly relate to a contract;
•
generate or enhance resources that will be used in satisfying (or in continuing to satisfy)
performance obligations in the future; and
•
are expected to be recovered
The Group has determined that, where the relevant criteria are met, the commission costs, equipment costs,
installation costs and carriage costs qualify to be accounted for as costs to fulfil a customer contract.
The Contract Cost Assets are amortised over the expected contract period on a systematic basis that reflects
the revenue stream generated by them, and this cost is included in cost of sales. The expected contract term
has been calculated as an average of the population of new orders in the year, and this calculation will be
reviewed annually.
At each reporting date, the Group determines whether or not the Contract Cost Assets are impaired by
comparing the carrying amount of the asset with the remaining amount of consideration that the Group
expects to receive less the costs that relate to providing services under the relevant contract.
Quartix Technologies plc
56
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Intangible assets
Goodwill arising on consolidation represents the excess of the consideration transferred and the amount
of any non-controlling interest in the acquiree over the fair value of the identifiable assets and liabilities
(including intangible assets) of the acquired entity at the date of the acquisition. Goodwill is recognised as
an asset and assessed for impairment annually or as triggering events occur. Goodwill arose in 2008 from
the acquisition of Quartix Limited, the main trading entity in the Group, which at the time only had
commercial fleet operations, therefore the entirety of this goodwill has been allocated to the fleet business
for the impairment review. Any impairment is recognised immediately in profit or loss.
Property, plant and equipment
Property, plant and equipment is stated at cost, net of depreciation and any provision for impairment.
Depreciation
Depreciation is charged so as to write off the cost of assets over their estimated useful lives, using the
straight-line method, on the following bases:
•
Leasehold properties
The life of the lease
•
Office equipment
25% straight line
•
Motor Vehicles
The life of the lease
Research and development
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Costs
that are directly attributable to a project’s development phase are recognised as internally generated
intangible assets, provided they meet all of the following recognition requirements:
•
The development costs can be measured reliably
•
The project is technically and commercially feasibly
•
The Group intends to and has sufficient resources to complete the project
•
The Group has the ability to use or sell the software/hardware
•
The software/hardware will generate probable future economic benefits.
Development costs not meeting these criteria for capitalisation are expensed as incurred.
Directly attributable costs include employee costs incurred on research and development along with an
appropriate portion of relevant costs. Where no internally generated intangible asset can be recognised,
development expenditure is recognised as an expense in the period in which it is incurred.
Impairment testing of intangible assets and property, plant and equipment
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its
recoverable amount, which is the higher of fair value less costs of disposal and value-in-use. To determine
the value-in-use, management estimates expected future cash flows and determines a suitable discount rate
in order to calculate the present value of those cash flows. The data used for impairment testing procedures
are directly linked to the Group’s latest approved budget. Discount factors are determined individually for
each cash-generating unit and reflect management’s assessment of respective risk profiles,
such as market and asset-specific risks factors. The cash-generating unit used for the impairment test of
goodwill is the fleet business as explained in the Intangible Assets policy above. Goodwill is assessed for
impairment at least annually (assessed at each reporting date).
Quartix Technologies plc
57
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Impairment testing of intangible assets and property, plant and equipment (continued)
Property, plant and equipment are tested for impairment if events or changes in circumstances (assessed at
each reporting date) indicate that the carrying amount may not be recoverable.
If a cash-generating unit is impaired, provision is made to reduce the carrying amount of the related assets
to their estimated recoverable amount, charged to profit & loss. Impairment losses are allocated firstly
against goodwill, and secondly on a pro rata basis against intangibles and other assets.
Leases
For any new lease contract entered into, the Group considers whether a contract is, or contains a lease. A
lease is defined as ‘a contract, or part of a contract, that conveys the right to use an asset (the underlying
asset) for a period of time in exchange for consideration’.
At lease commencement date, the Group recognises a right-of-use asset and a lease liability on the balance
sheet. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease
liability, any initial direct costs incurred by the Group, an estimate of any costs to dismantle and remove
the asset, or restore a property at the end of the lease, and any lease payments made in advance of the lease
commencement date (net of any incentives received).
The Group depreciates the right-of-use assets on a straight-line basis from the lease commencement date
to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The Group
also assesses the right-of-use asset for impairment when such indicators exist.
At the commencement date, the Group measures the lease liability at the present value of the lease payments
unpaid at that date, discounted using the interest rate implicit in the lease if that rate is readily available or
the Group’s incremental borrowing rate.
Lease payments included in the measurement of the lease liability are made up of fixed payments (including
in substance fixed), variable payments based on an index or rate, amounts expected to be payable under a
residual value guarantee and payments arising from options reasonably certain to be exercised.
Subsequent to initial measurement, the liability will be reduced for payments made and increased for
interest. It will also be remeasured to reflect any reassessment or modification, or if there are changes in
the in-substance fixed payments.
When the lease liability is remeasured, the corresponding adjustment is reflected in the right-of-use asset,
or profit and loss if the right-of-use asset is already reduced to zero.
The Group has elected to account for short-term leases and leases of low-value assets using the practical
expedients which are permitted in IFRS 16. Instead of recognising a right-of-use asset and lease liability,
the payments in relation to these are recognised as an expense in profit or loss on a straight-line basis over
the lease term.
Inventories
Components held for manufacture of vehicle tracking units and units not yet deployed to customers are
classified as inventory. Inventories are stated at the lower of cost and net realisable value less provision for
obsolete, slow moving or defective items. Cost is based on the cost of purchase on a first in first out basis.
Provision against inventories is recognised as an expense in the period in which the write-down or loss
occurs.
Quartix Technologies plc
58
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Taxation
Current tax is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have
been enacted or substantively enacted at the Statement of Financial Position date.
Deferred income taxes are calculated using the liability method on temporary differences. Deferred tax is
generally provided on the difference between the carrying amounts of assets and liabilities and their tax
bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial
recognition of an asset or liability unless the related transaction is a business combination or affects tax or
accounting profit. Tax losses available to be carried forward as well as other income tax credits to the Group
are assessed for recognition as deferred tax assets and are recognised to the extent that it is regarded as
more likely than not that they will be recovered from future trading profits, which for the first time in 2022
included the recognition of a deferred tax asset for the utilisation of tax losses in the US business.
Deferred tax liabilities are provided in full, with no discounting. Current and deferred tax assets and
liabilities are calculated at tax rates that are expected to apply to their respective period of realisation,
provided they are enacted or substantively enacted at the Statement of Financial Position date.
Changes in deferred tax assets or liabilities are recognised as a component of tax expense in profit or loss,
other comprehensive income or equity as appropriate.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term,
highly liquid investments that are readily convertible into known amounts of cash and which are subject to
an insignificant risk of changes in value.
Financial assets
The Group has reviewed its business model for its financial assets, which comprise only basic loans and
receivables, and concluded that they are held for collecting contractual associated cash flows. Under IFRS
9 loans and receivables, are initially recognised at fair value and will subsequently be measured at amortised
cost.
The Group makes use of a simplified approach in accounting for trade and other receivables and record
the loss allowance as lifetime expected credits. These are the expected shortfalls in contractual cash flows,
considering the potential for default at any point during the life of the financial instrument. In calculating,
the Group uses its historical experience, external indicators and forward-looking information to calculate
the expected credit losses using a provision matrix.
The Group assesses impairment of trade receivables on a collective basis. Since they have similar credit risk
characteristics, they are grouped based on the number of days past their due date. Refer to note 16 for an
analysis of how the impairment requirements of IFRS 9 are applied.
The Group will recognise in profit or loss, as an impairment gain or loss, the amount of expected credit
losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is
required to be recognised in accordance with IFRS 9.
Financial liabilities
Financial liabilities are obligations to pay cash or other financial assets and are recognised when the Group
becomes a party to the contractual provisions of the instrument.
Financial liabilities are recorded initially at fair value and subsequently at amortised cost using the
effective interest method, with interest-related charges recognised as an expense in finance cost in the
profit and loss. A financial liability is derecognised when the obligation is extinguished.
Quartix Technologies plc
59
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Provisions, contingent assets and contingent liabilities
Provisions for product warranties and replacement of units are recognised when the Group has a present
legal or constructive obligation as a result of a past event, it is probably that an outflow of economic
resources will be required from the Group and amounts can be estimated reliably. The timing or amount
of the outflow might be uncertain.
In line with IAS 37, provisions are measured at the estimated expenditure required to settle the present
obligation, based on the most reliable evidence available at the reporting date.
Equity
Equity comprises the following:
•
"Share capital" represents the nominal value of equity shares.
•
"Share premium account" represents the excess over nominal value of the fair value of
consideration received for equity shares, net of expenses of the share issue.
•
“Capital redemption reserve” represents the amount by which the Company's issued share capital
is diminished when shares are redeemed or purchased wholly out of the Company's profits.
•
“Equity reserve” is used to reflect the expenses associated with granting share options to employees
and the issue of warrants.
•
“Translation reserve” represents the exchange difference arising on the consolidation of foreign
operations.
•
"Retained earnings" represents retained profits.
Dividends
Dividends attributable to the equity holders of the Company approved for payment during the year are
recognised directly in equity.
Foreign currencies
The Parent Company's functional currency is Sterling. Quartix Inc has a functional currency of US Dollars.
Quartix SAS and Konetik have a functional currency of Euros.
The consolidated financial statements are presented in Sterling, which is the Group’s presentation currency.
Transactions in foreign currencies are translated into the respective currencies of Group companies at the
exchange rate ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are
translated at the rates of exchange ruling at the Statement of Financial Position date.
Foreign exchange differences arising on translation of monetary assets and liabilities are recognised in the
Consolidated Statement of Comprehensive Income. Non-monetary assets and liabilities that are measured
at historical costs in a foreign currency are translated using the exchange rates at the dates for the
transactions.
Income and expenses for all the Group entities that have a functional currency other than Sterling are
translated at the average rate prevailing in the month of the transaction. The assets and liabilities are
retranslated at the closing exchange rate at the reporting date.
On consolidation, exchange differences arising from the translation of the net investment in foreign entities
are recognised in the translation reserve, as a separate component of equity.
Quartix Technologies plc
60
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Employee benefits
The company participates in the Royal London pension scheme for UK employees and Malakoff Humanis
for those in France which are defined contribution pension schemes. Contributions to defined contribution
pension schemes are recognised as an employee benefit expense within personnel expenses in the income
statement, as incurred. Other employee benefits including holiday pay, company sick pay and a range of
tailored incentive schemes, some of which include the grant of share options, are recognised in the period
that related employee services are received.
Employee benefits: share based payments
The Group operates several employee share schemes for employees of its UK trading subsidiary under
which it makes equity-settled and cash-settled share-based payments.
Where employees are rewarded using share-based payments, the fair values of employees' services are
determined indirectly by reference to the fair value of the instrument granted to the employee. This fair
value is assessed at the grant date, for the schemes where there are no market performance conditions using
the Black-Scholes model, which excludes the impact of non-market vesting conditions. Under a share
scheme where there are market performance conditions, the binomial option pricing model has been used
which includes the impact of market vesting conditions (such as the growth in the share price).
All equity-settled share-based remuneration is ultimately recognised as an expense in profit or loss with a
corresponding credit to retained earnings. If vesting periods or other vesting conditions apply, the expense
is allocated over the vesting period, based on the best available estimate of the number of share options
expected to vest.
Estimates are subsequently revised if there is any indication that the number of share options expected to
vest differs from previous estimates. Any cumulative adjustment prior to vesting is recognised in the current
period. No adjustment is made to any expense recognised in prior periods if share options ultimately
exercised are different to that estimated on vesting.
2
Key judgements and estimates
The Group make estimates and assumptions regarding the future. Actual results may differ from these
estimates. The estimates and assumptions that have a significant risk of causing a material adjustment to
the carrying amount of assets and liabilities within the next financial year are addressed below.
Key judgement: capitalisation of development costs
The point at which development costs meet the criteria for capitalisation is critically dependent on
management’s judgment of the point at which development projects become technically and commercially
feasible. No development expenditure was capitalised in the year ended 31 December 2024. The research
and development expenditure primarily related to the on-going research work on the Group’s existing
vehicle telematics services to ensure that the functionality is maintained. The research work undertaken
may successfully come to fruition in the development of a marketable service or technology, but this
development work cannot be identified or separated from the research work and therefore the entire
expenditure has been expensed in the year. See the Strategic Report on page 11 for further information
about the Group’s approach to research and development.
Key judgement: timing of revenue recognition
The Group’s judgement continues to be that supplying telematics units, installing telematics units and the
provision of data services are a single performance obligation, under contracts with customers.
The performance obligations are satisfied over time, since the Group has the obligation to deliver the
data services for the contract term. Customers simultaneously receive and consume the benefits of the
tracking services as Quartix delivers its performance obligation.
Quartix Technologies plc
61
Financial statements for the year ended 31 December 2024
2
Key judgements and estimates (continued)
Key judgement: timing of revenue recognition (continued)
Where customer contracts are structured so that tracking units and installations are separately identified,
the Group recognises this revenue as part of the single performance obligation of delivering tracking
services.
Key judgement: capitalisation of costs to fulfil a customer contract
Judgement is applied by the Group when determining what costs qualify to be capitalised and when
considering if costs generate or enhance resources to be used to satisfy future performance obligations and
whether costs are expected to be recoverable. For example, the Group considers which type of sales
commissions are incremental to the cost of obtaining specific contracts and the point in time when the
costs will be capitalised.
Key judgement: Carrying value of goodwill and other intangible assets
The impairment analysis of intangible assets is based on the higher of fair value less costs to sell (where
reliable data is available) and future discounted cash flows. In the case the latter, several assumptions are
made to estimate the future cash flows expected to arise from the cash generating unit as well as a suitable
discount rate to calculate present value. Factors like anticipated sales and net cash flows and changes in
discount rates could lead to impairment. For details of assumptions see note 11.
Key judgement: assessment of 4G upgrade provision
The calculation of the upgrade provision to 4G units in both US and France is based on some inputs that
are verifiable, and other inputs that are based on internal management assumptions including a discount
rate of 4.5% and carries deferred tax at 25% of the provision balance included in deferred tax assets at the
year end. Changes in the time to complete the upgrade, the unit costs, the mix of installed units verses self-
install units could change the total provision estimate. For details of assumptions see note 19.
Key judgement: assessment of discontinued operation recognition
The Group has not recognised any discontinued operations in the current financial statements as none of
our business components meet the criteria for classification as discontinued operations under IFRS 5: Held
for sale. Despite Konetik being a stand-alone entity with its own distinguishable assets and liabilities, it was
not considered a major line of business, given its percentage of the group on a net profit, net assets and
headcount level was all less than 10%. As a result, Management concluded that the closing down of Konetik
did not meet the criteria for discontinued operation disclosure in line with IFRS 5.
3
Revenue
The Group’s revenue disaggregated by primary geographical markets is as follows:
2024
2023
£’000
£’000
United Kingdom
18,898
17,997
France
7,972
6,882
Other European Territories
2,358
1,674
United States of America
3,174
3,329
32,402
29,882
There are no material non-current assets based outside the UK.
The Group’s revenue disaggregated by pattern of revenue recognition is as follows:
2024
2023
£’000
£’000
Goods and services transferred over time
31,124
28,674
Revenue recognised at a point in time
1,278
1,208
32,402
29,882
Quartix Technologies plc
62
Financial statements for the year ended 31 December 2024
3
Revenue (continued)
Goods and services transferred over time represent 96.1% of total revenue (2023: 96.0%).
For 2024, revenue includes £3.6m (2023: £3.5m) included in the contract liability balance at the beginning
of the period (see note 20). Changes to the Group’s contract liabilities (i.e. deferred revenue) are attributable
solely to the satisfaction of performance obligations.
4
Profit/(loss) for the year before taxation
The profit/(loss) for the year for the Group is stated after charging/(crediting):
2024
2023
£’000
£’000
Research and development expenses
864
1,073
Replacement unit provision recognition
-
3,697
Rentals under short term lease agreements:
Other leases
22
21
Land and buildings
4
24
Depreciation on property, plant and equipment, owned
47
76
Depreciation on property, plant and equipment, right of use
147
157
Share-based payment (credit) / expense
(47)
78
Foreign exchange (gains) / losses
(4)
165
Expected credit loss (credit) / charge
(45)
92
Impairment of intangible asset
-
2,695
Fair value gain on deferred consideration
(73)
(312)
Audit services:
Fees paid to Company’s auditor and its associates for the audit of the
Company and consolidated financial statements
36
36
The audit of the Company’s subsidiary pursuant to legislation
80
79
Other services
-
-
Earnings before interest, tax, depreciation and amortisation (EBITDA):
2024
2023
£’000
£’000
Operating profit
6,464
(1,056)
Depreciation on property, plant and equipment, owned
47
76
Depreciation on property, plant and equipment, right of use
147
157
EBITDA
6,658
(823)
Share-based payment expense (incl. cash-settled)
(47)
78
Impairment of intangible asset: goodwill
-
2,464
Impairment of intangible asset: software
-
231
Fair value gain on re-estimate of future earn out payments
(73)
(312)
Exceptional provision for France
-
3,759
Adjusted EBITDA
6,538
5,397
5
Employee remuneration
Staff costs, including Directors, during the year were as follows:
2024
2023
£’000
£’000
Wages and salaries
7,036
7,637
Social security costs
1,005
985
Contributions to defined contribution pension plan
278
245
Share-based payment
(47)
78
8,272
8,945
Quartix Technologies plc
63
Financial statements for the year ended 31 December 2024
5
Employee remuneration (continued)
The average number of employees, including all Directors, during the year was as follows:
2024
2023
Administration
21
24
Operations
22
17
Sales
62
68
Customer service
40
49
Research and development
28
29
173
187
6
Key management remuneration and Directors’ remuneration
Key management personnel are those persons having authority and responsibility for planning, directing,
and controlling the activities of the entity, directly or indirectly, including any Directors (whether Executive
or otherwise) of the entity. For 2024, the Group identified eleven such individuals: one Executive Director,
two Non-Executive Directors, and eight members of Senior Management. In 2023, the Group identified
eleven such individuals: three Executive Directors, three Non-Executive Directors, and five members of
Senior Management.
2024
2023
£’000
£’000
Wages and salaries
1,114
1,117
Social security costs
165
162
Contributions to defined contribution pension plan
33
26
Share-based payment
(47)
73
Total employee benefits
1,265
1,378
Included in the payroll costs for the year is a gratuity payment of £25k to an executive director on their
resignation from the Group in 2024 (2023: £30k).
Details of Directors’ remuneration and the highest paid Director is disclosed on page 33.
The Group participates in the Royal London pension scheme for UK employees and Malakoff Humanis a
French compulsory pension scheme for those in France. No Director was a member of any other pension
scheme or other post-employment benefit to which the Group contributed in either the current or the prior
years.
The following relates to key management, including Directors:
2024
2023
Share based payment charge: equity options (£’000)
(47)
73
Equity settled share options held
120,938
413,187
Shares held
11,119,567
11,123,140
Included in above relating only to Directors of Quartix Technologies plc are:
2024
2023
Share based payment charge: equity options (£’000)
(82)
73
Equity settled share options held
-
106,000
Shares held
10,861,609
10,861,609
There were 37,218 options granted to Directors in 2024 (2023: nil). See note 24 for the assumptions used
in the valuation of the share options granted in the year. No share options were exercised in 2024.
Quartix Technologies plc
64
Financial statements for the year ended 31 December 2024
7
Finance income receivable
2024
2023
£’000
£’000
Bank interest
2
10
8
Finance costs payable
2024
2023
£’000
£’000
Lease interest expense
26
31
Discount on provision (note 19)
127
-
153
31
9
Tax expense
2024
2023
Analysis of tax charge in the year
£’000
£’000
Current tax
UK corporation tax charge on profit for the year
1,091
1,000
Adjustments in respect of prior periods
49
(152)
Total corporation tax
1,140
848
Deferred tax
Origination and reversal of temporary differences
407
(1,017)
Adjustments in respect of prior periods
-
-
Total deferred tax
407
(1,017)
Tax on profit/(loss) of ordinary activities
1,547
(169)
The relationship between the expected tax expense based on an effective tax rate of the Group of 25%
(2023: 23.5%), being the UK rate of corporation tax for the year, and the tax expense actually recognised
in profit or loss can be reconciled as follows:
2024
2023
£’000
£’000
Result for the year before taxation
6,313
(1,077)
Tax rate (%)
25.0
23.5
Expected tax expense
1,578
(253)
Adjustments to tax charge in respect of prior periods*
49
(152)
Losses not recognised in Germany
81
-
Expenses not deductible for tax purposes
(51)
17
Impairment of intangibles not deductible
-
601
Temporary differences not recognised in computation
35
(153)
Research and development tax credit
(145)
(231)
Remeasurement of deferred tax
-
2
Tax on profit on ordinary activities
1,547
(169)
Effective rate of tax
24.5%
15.7%
Quartix Technologies plc
65
Financial statements for the year ended 31 December 2024
10
Earnings per share and dividends
Earnings per share
The calculation of the basic earnings per share is based on the profits attributable to the shareholders of
Quartix Technologies plc divided by the weighted average number of shares in issue during the year. All
earnings per share calculations relate to continuing operations of the Group.
Profits/(Loss)
attributable to
shareholders
£’000
Weighted
average
number of
shares
Basic
profit per
share
amount
in pence
Fully
diluted
weighted
average
number of
shares
Diluted
earnings
per share
amount in
pence
Earnings per ordinary share
Year ended 31 December 2024
4,766
48,392,178
9.85
48,708,067
9.78
Year ended 31 December 2023
(908)
48,392,178
(1.88)
49,088,054
(1.88)
Adjusted earnings per
ordinary share
Year ended 31 December 2024
4,766
48,392,178
9.85
48,708,067
9.78
Year ended 31 December 2023
4,294
48,392,178
8.87
49,088,054
8.75
For diluted earnings per share, the weighted average number of ordinary shares is adjusted to assume the
conversion of all dilutive potential ordinary shares. Dilutive potential ordinary shares are those share
options where the exercise price is less than the average market price of the Company’s ordinary shares
during that year. There was no impact of dilution on earnings per share in 2023 since a loss was incurred.
To illustrate the underlying earnings for the year, the table above includes adjusted earnings per ordinary
share, which for 2023 excludes the £3.8m France 2G replacement unit provision recognised in the year
with its associated tax impact and the impairment on the goodwill and other intangibles recognised on
acquisition of Konetik of £2.7m offset by the fair value gain on the re-estimate of the future earn-out
payments due under the share purchase agreement for the purchase of Konetik.
Dividends
During the year ended 31 December 2024, the Group paid interim dividends of £0.7m (2023: £0.7m),
equivalent to 1.50p per share (2023: 1.50p per share). There was no supplementary interim dividend (2023:
nil).
Details of dividends the Board is recommending for approval at the AGM are included in the Directors’
Report on page 38. As the distribution of dividends require approval at the Annual General Meeting, no
liability in this respect is recognised in the 2024 consolidated financial statements.
11
Goodwill
Goodwill on
consolidation
£’000
Cost and net book value
At 1 January 2023
14,029
Goodwill recognised on acquisition
2,464
Impairment on goodwill
(2,464)
At 31 December 2023
14,029
At 31 December 2024
14,029
Goodwill is recognised as an asset and assessed for impairment annually or where there is indication of
impairment. Any impairment is recognised immediately in profit or loss (see note 1).
Quartix Technologies plc
66
Financial statements for the year ended 31 December 2024
11
Goodwill (continued)
Goodwill arose on the consolidation of the Group following the acquisition of Quartix Limited in 2008.
Goodwill also arose on the on the acquisition of Konetik Deutschland GmbH in 2023 and was immediately
fully impaired. In the prior year £2.5m in relation to the goodwill and £0.2m in relation to technology
recognised on acquisition were both fully impaired.
The Group considers the fleet business of Quartix Limited to be the sole cash-generating unit (CGU) for
the assessment of goodwill recognised on acquisition of Quartix Limited (see Intangible Assets policy
included in note 1). The Group has determined its recoverable amount based on value in use calculations.
The value in use was derived from discounted management cash flow forecasts for the business, using the
budgets and strategic plans based on past performance and expectations for the market development of
the CGU, incorporating an appropriate business risk and covering a total of four future years. The key
assumptions for the value in use calculations are those regarding the discount rates, growth rates and
expected changes to selling prices and direct costs during the period based on industry sector forecasts.
These budgets and strategic plans cover a four-year period. The growth rate in years one and two were
based on detailed management expectations. The growth rate used for the third and fourth year is 5% which
is based on actual revenue growth in recent years and the size of the remaining potential addressable market.
The discount rate used is Group’s weighted average cost of capital of 5.9% which is based on UK market
return data and the volatility of the company’s share price. Sensitivity analysis is carried out on all budgets,
strategic plans and discount rates used in the calculations. The estimate of the recoverable amount for the
cash generating unit is not particularly sensitive to the discount rate.
Management’s key assumptions are based on past experience and the current trading performance of the
CGU. These value in use calculations, including sensitivity analysis, have not identified any requirement for
impairment of the goodwill associated with the acquisition of Quartix Limited by Quartix Technologies
plc. Management was not aware of any probable changes that would necessitate changes in key estimates
that indicate any impairment sensitivity on the assessment of goodwill associated with the fleet business of
Quartix. The goodwill recognised on the acquisition of Quartix Limited will continue to be reviewed
annually for impairment.
12
Subsidiaries
As at the 31 December 2024 the subsidiaries of the Group were:
Subsidiary
Quartix Ltd
Quartix Inc
Quartix SAS
Konetik
Deutschland
GmbH
Country of
registration
England &
Wales
USA
France
Germany
Registered
office
New Church
Street,
Newtown,
Powys
SY16 1AF
901 2nd Street,
Springfield,
Sangamon IL
62704-7909
USA
10 Rue du
Colisee, 75008
Paris, France.
Akazienstr. 3A
10823, Berlin,
Germany.
Class of share
capital held
Ordinary
shares
Common
shares
Common
shares
Ordinary
shares
Shares held by
the Company
100%
100%
0.1%
-
Shares held by
the Group
100%
100%
100%
100%
Nature of the
business
Vehicle
Tracking
Vehicle
Tracking
Vehicle
Tracking
Software
development
Quartix Technologies plc
67
Financial statements for the year ended 31 December 2024
13
Property, plant and equipment
Leasehold
properties
Office
equipment
Motor
vehicles
Total
£’000
£’000
£’000
£’000
Cost:
At 1 January 2023
845
855
165
1,865
Additions
55
17
-
72
Disposals
-
(2)
-
(2)
Foreign exchange
-
-
-
-
At 31 December 2023
900
870
165
1,935
Additions
-
11
62
73
Disposals
-
(1)
-
(1)
Foreign exchange
-
-
-
-
At 31 December 2024
900
880
227
2,007
Depreciation:
At 1 January 2023
269
710
41
1,020
Charge for the year
104
77
52
233
Disposals
-
-
-
-
Foreign exchange
-
-
(2)
(2)
At 31 December 2023
373
787
91
1,251
Charge for the year
106
43
45
194
Disposals
-
-
-
-
Foreign exchange
-
-
2
2
At 31 December 2024
479
830
138
1,447
Net book amount:
At 31 December 2024
421
50
89
560
At 31 December 2023
527
83
74
684
At 31 December 2022
576
145
124
845
14
Inventories
Components held for manufacture of vehicle tracking units and units not yet deployed to customers:
2024
2023
£’000
£’000
Raw materials
909
927
Work in progress
252
45
Finished goods and goods for resale
571
439
1,732
1,411
Included in the analysis above are impairment provisions against inventory amounting to £240k (2023:
£81k). The cost of vehicle tracking units are recognised as an expense and included in “cost of sales”
amounted to £4.6m (2023: £3.2m).
Quartix Technologies plc
68
Financial statements for the year ended 31 December 2024
15
Contract cost assets
Contract cost assets represents the costs incurred at the inception of a contract, that are directly incidental
to the contract. The costs are recognised on a straight line basis over the contract term, since the customer
benefits from the Group’s services evenly throughout the contract term and receives the benefit of the
services as they are made available:
Contract asset costs are presented in the statement of financial position as follows:
2024
2023
£’000
£’000
Current contract cost assets
5,045
4,550
Non-current contract cost assets
1,125
894
Total contract cost assets
6,170
5,444
Contract cost assets comprises the following cost categories:
2024
2023
£'000
£’000
Equipment hardware
2,991
2,876
Commissions
1,749
1,335
Installation
1,082
945
Carriage
348
288
6,170
5,444
•
Equipment cost relates to the tracker unit hardware that customers need to install in their
vehicles and are a prerequisite to enable Quartix to capture the data on the vehicle, in order to
deliver the data services.
•
Commissions incurred in winning customer contracts.
•
Installation costs for tracker unit hardware relating to new unit subscriptions.
•
Carriage costs associated with the delivery of equipment hardware for new unit subscriptions.
The amortisation of the Group’s contract cost assets are attributable solely to the satisfaction of
performance obligations. The increase in contract costs assets was due to both the growth in new unit
subscriptions and the increase in equipment hardware costs.
2024
2023
£'000
£’000
Contract costs assets at 1 January
5,444
4,288
Contract costs assets amortised in the period
(6,800)
(5,920)
Contract costs capitalised in the period
7,526
7,073
Foreign exchange
-
3
Contract costs assets at 31 December
6,170
5,444
16
Trade and other receivables
2024
2023
£’000
£,000
Trade receivables
3,701
3,572
Other receivables
3
74
Prepayments and accrued income
411
540
4,115
4,186
Quartix Technologies plc
69
Financial statements for the year ended 31 December 2024
16
Trade and other receivables (continued)
All the amounts are due within one year. Trade receivables are measured initially at fair value and
subsequently at amortised cost. At each period end, there is an assessment of the expected credit loss in
accordance with IFRS 9 with any increase or reduction in the credit loss provision charged or released to
administration costs in the statement of comprehensive income.
The loss allowance for expected credit losses has been recorded as follows.
2024
2023
£’000
£’000
Loss allowance at 1 January
294
204
(Decrease)/increase in loss allowance
(45)
92
Foreign exchange
(2)
(2)
Loss allowance at 31 December
247
294
As explained in note 30, the Group’s trade receivables arise from transactions that do not contain a
significant financing component, therefore the loss allowance is always measured at an amount equal to
lifetime expected credit losses.
The expected credit loss for trade receivable balances overdue at 31 December was determined as follows:
2024
2023
£’000
£’000
Not more than one month
432
548
More than one month
156
455
588
1,003
17
Cash and cash equivalents
Cash and cash equivalents include the following components:
2024
2023
£'000
£’000
Cash at bank and in hand
3,101
2,380
18
Trade and other payables
Amounts falling due within one year:
2024
2023
£'000
£’000
Trade payables
1,978
1,913
Social security and other taxes
724
707
Other payables
67
99
Deferred consideration for the acquisition of Konetik*
-
291
Accruals
1,112
805
Lease liabilities (see note 21)
148
140
4,029
3,955
*Of the balance due at 31 December 2023, £0.1m had been due after more than one year but was not split
on the face of the statement of financial position due to the non-current element being immaterial.
Quartix Technologies plc
70
Financial statements for the year ended 31 December 2024
19
Provisions
The carrying amounts and the movements in the provision account are as follows:
Replacement
Other
Total
£’000
£’000
£’000
Carrying amount at 1 January 2023
449
94
543
Amount utilised
(50)
(10)
(60)
Amount charged
3,759
-
3,759
Foreign exchange
(24)
-
(24)
Carrying amount at 31 December 2023
4,134
84
4,218
Amount utilised
(1,337)
(55)
(1,392)
Decrease in provision on re-estimate
(561)
-
(561)
Unwinding of discount
127
-
127
Foreign exchange
(141)
-
(141)
Carrying amount at 31 December 2024
2,222
29
2,251
Current provisions
1,174
29
1,203
Non-current provisions
1,048
-
1,048
2,222
29
2,251
The Group makes full provision for the future cost of replacements on a discounted basis at the end of a
reporting period following the Groups network provider announcement of the sunsetting of the network
that the tracking units are compatible with. The provision for the replacement of the units in France,
recognised in 2023, represents the present value of the replacement costs which are expected to be
incurred over the next two to three years, as the expected shut down communicated by the network
provider for units in France is December 2026. The provisions have been created based on the Company’s
internal estimates. Assumptions based on the current economic environment have been made, which
management believe are a reasonable basis upon which to estimate the future liability. These estimates are
reviewed regularly to take into account any material changes to the assumptions. The discount rate used
to calculate the present value of the provision to replace the 2G units in France is 4.6% (2023: 3.5%) which
was the risk free rate for the Group equivalent to UK 10 year Government Bond yield at the end of the
year. A deferred tax asset is recognised at 25% of the provision outstanding for the replacement units in
France.
The majority of the other provision relates to standard or extended warranties for which customers are
covered for the cost of repairs or replacement units as appropriate.
20
Contract liabilities
2024
2023
£'000
£’000
Deferred insurance tracking data services income
2
135
Deferred fleet tracking data services income
3,780
3,544
3,782
3,679
Deferred tracking data services income represents customer payments received in advance of performance
(contract liabilities) that are expected to be recognised as revenue in future years, as described in note 1.
Quartix Technologies plc
71
Financial statements for the year ended 31 December 2024
20
Contract liabilities (continued)
•
Under insurance contracts, the customer commits to purchase data services for 12 months.
Quartix raises a single invoice upon installation and recognises revenue over 12 months on a
straight-line basis, since the customer benefits from the Group’s services evenly throughout the
contract term and receives the benefit of the services as they are made available.
•
Fleet customers enter into contracts typically with a commitment to purchase data services for
12-36 months and are generally invoiced quarterly in advance and recognises revenue over the
period covered by the invoice, as the performance obligations are satisfied.
The amounts recognised as a contract liability will generally be utilised within the next reporting period.
Changes to the Group’s contract liabilities (i.e. deferred revenue) are attributable solely to the satisfaction
of performance obligations.
2024
2023
£'000
£’000
Contract liabilities at 1 January
3,679
3,499
Contract liabilities released to revenue in the period
(3,566)
(3,526)
Contract revenue deferred in the period
3,669
3,706
Contract liabilities at 31 December
3,782
3,679
21
Lease liabilities
The Group has leases for the property it occupies and motor vehicles. With the exception of short-term
leases and leases considered to be of a low value, each lease is reflected on the balance sheet as a right of
use asset and a lease liability. The Group classifies its right-of-use assets in a consistent manner to its
property, plant and equipment for presentation purposes.
Included in the net carrying amount and depreciation provided for in the year of property, plant and
equipment (note 13) are right-of-use assets as follows:
2024
2023
Right-of-use asset carrying amounts
£’000
£’000
Property
420
525
Motor Vehicles
70
74
Total
490
599
Depreciation
Property
106
105
Motor Vehicles
41
52
Total
147
157
Each lease imposes a restriction that the right-of-use asset can only be used by the Group. Some leases
have a break clause; however, the majority are either non-cancellable or may only be cancelled by incurring
a substantial termination fee.
The Group is prohibited from selling or pledging the underlying leased assets as security. For the property
leases, the Group must keep the property in a good state of repair and return the properties in their original
state at the end of the lease. Furthermore, the Group must insure items of property, plant and equipment
and incur maintenance fees on such items in accordance with the lease contracts.
Quartix Technologies plc
72
Financial statements for the year ended 31 December 2024
21
Lease liabilities (continued)
Lease liabilities are presented in the statement of financial position as follows:
2024
2023
£’000
£’000
Current lease liabilities (see note 18)
148
140
Non-current lease liabilities
411
520
Total lease liabilities
559
660
Future minimum lease payments at 31 December 2024 were as follows:
Minimum lease payments due
Within 1
year
1 to 5
years
After 5
years
Total
31 December 2024
£000
£000
£000
£000
Lease payments
169
446
-
615
Finance charges
(21)
(35)
-
(56)
Net present value
148
411
-
559
31 December 2023
Lease payments
166
478
96
740
Finance charges
(26)
(52)
(2)
(80)
Net present value
140
426
94
660
Total cash outflow for the year ended 31 December 2024 was £166,000 (2023: £172,000).
Lease payments not recognised as a liability:
The Group has elected not to recognise a lease liability for short term leases (leases with an expected term
of 12 months or less) or leases considered to be low value. Payments made under such leases are expensed
on a straight-line basis.
The expense relating to payments not included in the measurement of the lease liability at 31 December
2024 was £26,000 (2023: £45,000). At the year end the Group was committed to short-term leases and the
total commitment at that date was nil (2023: £5,000).
22
Deferred tax
Deferred tax assets/(liabilities) recognised by the Group at 31 December 2024 and 31 December 2023 are
as follows:
2024
2023
Deferred tax asset/(liability)
£’000
£’000
Accelerated Capital Allowances
(11)
(20)
Right of Use Asset (IFRS 16)
(123)
(149)
Lease Liability (IFRS 16)
140
166
Short term temporary differences
728
1,147
Equity settled share options
3
-
737
1,144
Quartix Technologies plc
73
Financial statements for the year ended 31 December 2024
22
Deferred tax (continued)
2024
2023
£’000
£’000
(Credit)/charge to profit and loss
Accelerated Capital Allowances
(8)
(35)
Short term temporary differences
417
(1,003)
Equity settled share options
(2)
21
Total (see note 9)
407
(1,017)
Included in the 2024 deferred tax balance is $123k for the provision of tax losses related to the US business
(2023: $222k).
23
Equity
Number of
ordinary
shares of
£0.01 each
Share
capital
£’000
Share
premium
£’000
Allotted, called up and fully paid
At 1 January and 31 December
2024
48,392,178
484
6,332
No shares were issued in the year to 31 December 2024 (2023: none).
24
Share-based payment
The Company has share option schemes for certain employees. Share options are exercisable at prices
determined at the date of grant. The vesting periods for the share options range between 12 and 63 months.
Options are forfeited if the employee leaves the Company before the options vest.
Movements in the number of equity-settled share options outstanding and their related weighted average
exercise prices are as follows:
2024
2023
Weighted
average exercise
price per share
Options
Weighted
average exercise
price per share
Options
in pence
number
in pence
number
Outstanding at 1 January
243.0
671,316
212.6
805,063
Granted
1.0
37,218
-
-
Cancelled
360.0
(74,965)
-
-
Lapsed
1.0
(323,627)
59.7
(133,747)
Forfeited
0.9
(106,276)
-
-
Outstanding at 31 December
239.2
203,666
243.0
671,316
Exercisable at 31 December
292.5
166,448
288.4
565,317
The weighted average fair value of equity settled options granted during the year ended 31 December 2024
was 135.1p (2023: none granted).
There were no options exercised in the year ended 31 December 2024 (2023: none exercised).
Quartix Technologies plc
74
Financial statements for the year ended 31 December 2024
24
Share based payments (continued)
At 31 December Quartix Technologies plc had the following outstanding equity-settled options and
exercise prices:
2024
Average
exercise price
per share
Options
Weighted
average
remaining
contractual
life
Period when exercisable
Expiry dates
in pence
number
in months
Starting from March 2020
31 March 2026
270.0
29,320
15
Starting October 2020
30 September 2025
335.0
25,000
9
Starting from May 2022
1 May 2026
291.0
111,300
16
Starting from March 2023
1 December 2025
1.0
828
11
Starting May 2024
3 May 2025
1.0
37,218
4
239.2
203,666
12.8
2023
Average
exercise price
per share
Options
Weighted
average
remaining
contractual
life
Period when exercisable
Expiry dates
in pence
number
in months
Starting from March 2019
31 March 2025
360.0
74,965
15
Starting from March 2020
31 March 2024
270.0
323,627
3
Starting from March 2020
31 March 2026
270.0
29,320
27
Starting October 2020
30 September 2025
335.0
25,000
21
Starting from May 2022
1 May 2026
291.0
111,300
28
Starting from March 2023
1 December 2025
1.0
1,104
23
Starting April 2024
20 December 2032
1.0
106,000
108
243.0
671,316
26.8
The fair value of equity-settled share-based payments, without a market based performance condition, have
been calculated using the Black-Scholes option pricing model. Expected volatility was determined based
on the historic volatility of the Group’s share price. The expected life is the expected period from grant to
exercise based on management’s best estimate.
The risk-free return is based on UK Government gilt yields at the time of the grant.
The following assumptions were used in the model for equity-settled options granted during the year ended
31 December 2024:
Number granted
37,218
Grant date
May 24
Share price at grant date (pence)
160
Exercise price (pence)
1.0
Fair value per option (pence)
135
Expected life in years
1.0
Expected volatility (%)
49.9
Risk-free interest rate (%)
3.9
Dividend yield (%)
2.8
Quartix Technologies plc
75
Financial statements for the year ended 31 December 2024
25
Notes to the cash flow statement
Cash flow adjustments and changes in working capital
2024
2023
Notes
£’000
£’000
Profit/(loss) before tax
6,313
(1,077)
Foreign exchange
304
25
Depreciation
4, 13
194
233
Interest income
7
(2)
(10)
Lease interest expense
8
26
31
Share based payment expense
(47)
78
Impairment
11
(204)
2,695
Operating cash flow before movement in working
capital
6,584
1,975
Increase/(decrease) in trade and other receivables
12
(599)
(Increase) in contract cost assets
(832)
(1,157)
(Increase)/decrease in inventories
(320)
579
(Decrease)/Increase in trade and other payables
(1,495)
3,504
Increase in contract liabilities
148
163
Cash generated from operations
4,097
4,465
26
Reconciliation of liabilities arising from financing activities
The changes in the Group’s liabilities arising from financing activities, is entirely as a result of lease liabilities
which is as follows:
2024
2023
£’000
£’000
1 January
660
748
Non-cash: Additions
65
84
Cash-flows: Repayment
(166)
(172)
31 December (see note 21)
559
660
27
Related party transactions and controlling related party
The Group’s related parties comprise its Board of Directors and its key management (see note 6). There
were no related party transactions with Directors to disclose other than dividends received based on
shareholdings disclosed in the Directors’ Remuneration Report on page 34 and note 6.
The Directors consider the Board and shareholding structure to mean there is no directly identifiable
controlling party.
28
Purchase commitments and contingent liabilities
Quartix Limited has signed agreements with suppliers which commit the Group to purchase inventory to
the value of £0.4m (2023: £0.9m).
There was no short term lease commitment at year end (2023: £5k rental on a property).
There were no other financial commitments or contingent liabilities at 31 December 2024 or 31 December
2023.
Quartix Technologies plc
76
Financial statements for the year ended 31 December 2024
29
Capital commitments
The Group had no capital commitments as at 31 December 2023 or 31 December 2022.
30
Risk management objectives and policies
Financial instruments
The Group uses various financial instruments; these include cash deposits and various items such as trade
receivables and trade payables that arise directly from its operations. The main purpose of these financial
instruments is to raise finance for the Group's operations and manage working capital.
The main risks arising from the Group's financial instruments are credit risk and currency risk. The Board
reviews and agrees policies for managing each of these risks and they are summarised below.
Credit risk
The Group's exposure to credit risk is limited to the carrying amount of financial assets recognised at the
Statement of Financial Position date, as summarised below:
2024
2023
£’000
£’000
Financial assets
Trade receivables and other receivables
3,704
3,646
Cash and cash equivalents
3,101
2,380
6,805
6,026
The Group's principal financial assets are cash deposits and trade receivables. Risks associated with cash
deposits are limited as the banks used have high credit ratings assigned by international credit rating
agencies.
The principal credit risk relates to trade receivables and is mitigated, where possible, by third party credit
clearance for new customers and collection by direct debit, or similar. The Group has established credit
control procedures to undertake various tasks at different stages as invoices move further from their issue
date. At 45 days past due date, the credit risk is believed to have increased substantially and customers are
included in the loss allowance assessment.
The Group uses the practical expedient in the calculation of the expected credit losses on all its trade
receivables using a provision matrix, to estimate the lifetime expected credit losses, with fixed provision
rates, based on its historical credit loss experience adjusted where possible for current observable data. The
Group uses such data to make reasonable forward-looking estimates of recoverability.
The Group continues to work with customers to recover trade receivables and may take legal action or use
third-party collection specialists where necessary. Only after these steps have been completed and there is
no reasonable expectation of recovery, would the receivable be written off.
Currency risk
The Group is exposed to transaction foreign exchange risk as a consequence of procuring tracking unit
components in both euros and dollars. The risk with the Euro has been mitigated by trading in France
which generates enough Euros to cover the Group’s needs. Whilst the Group also trades in the US, in 2024,
the Group purchased about $3.0m, primarily to purchase components for the vehicle tracking units (2023:
$1.2m).
Transaction exposures, including those associated with forecast transactions, are managed through the use
of bank accounts held in foreign currencies.
Quartix Technologies plc
77
Financial statements for the year ended 31 December 2024
30
Risk management objectives and policies (continued)
Currency risk (continued)
It is estimated that a 5.0% strengthening of Pound Sterling to the US dollar would have Increased net profit
by £109,900and vice versa (2023: £194,000). (This is assuming that Dollar denominated prices do not adjust
for currency movements.)
It is estimated that a 5.0% strengthening of Pound Sterling to the Euro would have reduced net profit by
£161,300 and vice versa (2023: £60,000).
The Group’s financial instruments denominated in foreign currencies were:
2024
2023
£’000
£’000
£’000
£’000
£’000
£’000
US$
€
zl
US$
€
zl
Cash and cash equivalents
381
2,168
-
203
1,046
(4)
Trade receivables
363
1,478
44
417
1,053
-
Trade payables
(763)
(588)
-
(232)
(654)
-
(19)
3,058
44
388
1,445
(4)
As set out in the accounting policies (note 1), the assets and liabilities of Group entities that have a
functional currency other than Sterling are translated at the closing exchange rate at the reporting date. The
US dollar exchange rate weakened by 1.7% from 31 December 2023 to 31 December 2024 (2023:
strengthened by 5.9%). The Euro exchange rate strengthened by 4.9% from 31 December 2023 to 31
December 2024 (2023: strengthened by 2.39%). The total translation reserve movement for the year
reported in the Consolidated Statement of Changes in Equity was a debit £14,000 (2023: credit of £43,000).
The majority of this movement related to the retranslation of Quartix SAS’s opening assets as at 1 January
2024.
Quartix Inc’s net liabilities relate mainly to amounts owed to other Group entities and the 3G units swap
out provision. The foreign exchange differences arising on translation of these monetary liabilities are
recognised in the Consolidated Income Statement.
It is estimated that a 5.0% weakening of Pound Sterling to the US dollar would give an exchange loss of
around £36,000 (2023: loss £39,000) from the retranslation of Quartix Inc’s net liabilities, the exchange
gain that relates to the retranslation of amounts owed by Quartix Inc is around £12,000 (2023: gain
£79,000).
It is estimated that a 5.0% weakening of Pound Sterling to the Euro would give an exchange gain of around
£149,000 (2023: nil) from the retranslation of Quartix SAS’s net assets, the exchange loss that relates to the
retranslation of amounts owed by Quartix SAS is around £53,000 (2023: nil).
Interest rate risk
The Group has no debt so it is not exposed to fluctuations in interest rates.
Liquidity risk
The Group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable
needs. Cash flow is forecast and monitored as are working capital requirements. The Group generates funds
from operational activities in excess of its operational requirements and has substantial cash balances
available for its current investment activities. Consequently, liquidity is not seen as a key risk. As at 31
December 2024, the Group’s non-derivative financial liabilities that have contractual maturities of more
than 12 months are lease liabilities; see note 21 for the maturity analysis of lease liabilities.
Quartix Technologies plc
78
Financial statements for the year ended 31 December 2024
31
Summary of financial assets and liabilities by category
The carrying amounts of the assets and liabilities as recognised at the Statement of Financial Position date
of the years under review may also be categorised as follows:
2024
2023
£’000
£’000
Financial assets held at amortised cost
Trade and other receivables
3,704
3,646
Cash and cash equivalents
3,101
2,380
6,805
6,026
2024
2023
£’000
£’000
Financial liabilities measured at amortised cost
Trade and other payables
5,312
6,935
Lease liabilities
559
660
5,871
7,595
32
Capital management policies and procedures
The Group's capital management objectives are to ensure the Group's ability to continue as a going concern
and to provide an adequate return to shareholders, by balancing its trading performance with continuing
investment in research and development.
The Group monitors capital on the basis of the carrying amount of equity less cash and cash equivalents as
presented on the face of the Statement of Financial Position.
The Group makes adjustments to its capital in the light of changes in economic conditions and the risk
characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Group may
adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell
assets. Capital for the reporting years under review is summarised as follows:
2024
2023
£’000
£’000
Capital
Total equity
19,602
16,332
Less cash and cash equivalents
(3,101)
(2,380)
16,501
13,952
Overall financing
Total equity
19,602
16,332
Lease liabilities
559
660
20,161
16,992
Capital-to-overall financing ratio (%)
82
82
Quartix Technologies plc
79
Financial statements for the year ended 31 December 2024
Parent Company Statement of Financial Position
Company registration number 06395159
2024
2023
Notes
£’000
£'000
Fixed assets
Investments
4
20,285
20,334
Current assets
Debtors
5
111
104
Current tax asset
80
40
Cash at bank and in hand
41
134
Total current assets
232
278
Creditors – amounts falling due within one year
6
(552)
(3,954)
Net current (liabilities)
(320)
(3,676)
Total assets less current liabilities
19,965
16,658
Net assets
19,965
16,658
Capital and reserves
Share capital
7
484
484
Share premium account
7
6,332
6,332
Equity reserve
163
392
Capital redemption reserve
4,663
4,663
Retained earnings
8,323
4,787
Total equity attributable to equity shareholders of Quartix
Technologies plc
19,965
16,658
No Statement of profit and loss is presented for Quartix Technologies plc as provided by section 408 of
the Companies Act 2006. Profit/(loss) for the year and total comprehensive income attributable to the
equity shareholders of Quartix Technologies plc was £4,806,000 (2023: loss of £303,000).
Approved by the Board of Directors, authorised for issue and signed on behalf of the Board on 28 February
2025.
Andrew Walters
Executive Chairman
Quartix Technologies plc
80
Financial statements for the year ended 31 December 2024
Parent Company Statement of Changes in Equity
Share
capital
Share
premium
account
Capital
redemption
reserve
Equity
reserve
Retained
earnings
Total
equity
£’000
£,000
£’000
£’000
£’000
£’000
Balance at 31 December 2022
484
6,332
4,663
342
8,837 20,658
Shares issued
-
-
-
-
-
-
Increase in equity reserve in
relation to options issued
-
-
-
78
-
78
Recycle of equity reserve to P&L
reserve
-
-
-
(28)
28
-
Dividend paid
-
-
-
-
(3,775) (3,775)
Transactions with owners
-
-
-
50
(3,747) (3,697)
Loss for the year and total
comprehensive income
-
-
-
-
(303)
(303)
Balance at 31 December 2023
484
6,332
4,663
392
4,787
16,658
Shares issued
-
-
-
-
-
-
Increase in equity reserve in
relation to options issued
-
-
-
(47)
-
(47)
Recycle of equity reserve to P&L
reserve
-
-
-
(182)
182
-
Dividend paid
-
-
-
-
(1,452) (1,452)
Transactions with owners
-
-
-
(229)
(1,270) (1,499)
Profit for the year and total
comprehensive income
-
-
-
-
4,806
4,806
Balance at 31 December 2024
484
6,332
4,663
163
8,323
19,965
Quartix Technologies plc
81
Financial statements for the year ended 31 December 2024
Notes to the Parent Company Financial Statements
1
Summary of significant accounting policies
Accounting convention
These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced
Disclosure Framework (FRS 101). The financial statements are prepared under the historical cost
convention.
No profit and loss account is presented by the Company as permitted by Section 408 of the Companies
Act 2006.
The financial statements are prepared in Sterling and are rounded to the nearest thousand pounds (£’000).
Basis of preparation
The accounting policies which follow were those applied in preparing the financial statements for the year
ended 31 December 2024 and the year ended 31 December 2023. The Company has taken advantage of
the following disclosure exemptions under FRS 101:
a) Share-based Payment disclosure, as Quartix Technologies plc is the ultimate parent, the share-
based payment arrangement concerns its own equity instruments and its separate financial
statements are presented alongside the consolidated financial statements of the Group.
b) Financial Instruments disclosures, given that equivalent disclosures are included in the consolidated
financial statements of the Group in which the entity is consolidated.
c) Fair Value Measurement disclosures.
d) Certain disclosures required by IAS 1 Presentation of Financial Statements, including certain
comparative information in respect of share capital movements.
e) Statement of Cash Flows and related notes.
f) Related Party Disclosures relating to key management personnel compensation.
g) Disclosure of related party transactions entered into between two or more members of a group,
given that any subsidiary which is a party to the transaction is wholly owned by such a member.
h) Capital management disclosures.
Going concern
As a holding company, its main source of income is dividends receivable from its trading subsidiaries and
in particular Quartix Limited. For further details, refer to the accounting policy note on Going Concern
for the Group on pages 53-54.
Investment in subsidiaries
The Company’s interests in investments presently comprise only interest in wholly owned subsidiary
undertakings. Investments are recognised initially at cost. Subsequent to initial recognition the financial
statements include the adjustments in respect of Share Based Payments or provision for impairment.
Quartix Technologies plc
82
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Impairment of assets
The Company assesses at each reporting date whether there is any indication that an asset may be impaired.
If any such indication exists, the Company estimates the recoverable amount of the asset, being the higher
of an asset’s or cash generating unit’s fair value less costs to sell and its value in use. To determine the value-
in-use, management estimates expected future cash flows and determines a suitable interest rate in order to
calculate the present value of those cash flows. The data used for impairment testing procedures are directly
linked to the Group’s latest approved budget. Discount factors are determined individually for each cash-
generating unit and reflect management’s assessment of respective risk profiles, such as market and asset-
specific risks factors.
A reversal of an impairment loss for an asset shall be recognised immediately in profit or loss, unless the
asset is carried at revalued amount. Any reversal of an impairment loss of a revalued asset shall be treated
as a revaluation increase.
Taxation
Current tax is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have
been enacted or substantively enacted by the Statement of Financial Position date.
Deferred income taxes are calculated using the liability method on temporary differences. Deferred tax is
generally provided on the difference between the carrying amounts of assets and liabilities and their tax
bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial
recognition of an asset or liability unless the related transaction is a business combination or affects tax or
accounting profit. Tax losses available to be carried forward as well as other income tax credits to the
Company are assessed for recognition as deferred tax assets and are recognised to the extent that it is
regarded as more likely than not that they will be recovered from future trading profits.
Deferred tax liabilities are provided in full, with no discounting. Current and deferred tax assets and
liabilities are calculated at tax rates that are expected to apply to their respective period of realisation,
provided they are enacted or substantively enacted at the Statement of Financial Position date.
Changes in deferred tax assets or liabilities are recognised as a component of tax expense in profit or loss,
other comprehensive income or equity as appropriate.
Dividends
Dividends attributable to the equity holders of the Company approved for payment during the year are
recognised directly in equity.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term,
highly liquid investments that are readily convertible into known amounts of cash and which are subject to
an insignificant risk of changes in value.
Financial assets
As required by IFRS 9, the Company will apply the impairment requirements and recognise a loss allowance
for expected credit losses on its financial assets. At each reporting date, it will measure the loss allowance
at an amount equal to the lifetime expected credit losses, if the credit risk on financial instruments has
increased significantly since initial recognition.
Quartix Technologies plc
83
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Financial assets (continued)
The Company will recognise in profit or loss, as an impairment gain or loss, the amount of expected credit
losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is
required to be recognised in accordance with IFRS 9.
Financial liabilities
Financial liabilities are obligations to pay cash or other financial assets and are recognised when the
Company becomes a party to the contractual provisions of the instrument.
Financial liabilities are recorded initially at fair value and subsequently at amortised cost using the effective
interest method, with interest-related charges recognised as an expense in finance cost in the profit and
loss.
A financial liability is derecognised only when the obligation is extinguished. The Company does not enter
into derivative contracts for hedging or speculative purposes.
Foreign currencies
Transactions in foreign currencies are translated into Sterling at the exchange rate ruling at the date of the
transaction. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling
at the Statement of Financial Position date.
Any exchange differences arising on the settlement of monetary items or on translating monetary items at
rates different from those at which they were initially recorded are recognised in profit or loss in the period
in which they arise.
Employee benefits: Share-based payments
The Company operates several employee share schemes for employees of its UK trading subsidiary under
which it makes equity-settled and cash-settled share-based payments.
For equity-settled options, the fair value of the employee services received in exchange for the grant of the
options is recognised as an increase in the investment in the subsidiary, with a corresponding increase in
equity, over the period that the employees unconditionally become entitled to the awards. The fair values
of employees' services are determined indirectly by reference to the fair value of the instrument granted to
the employee. This fair value is assessed at the grant date, using the Black-Scholes option pricing model
where there is no market based performance condition, whilst the binomial option pricing model is used
to account assess the fair value for options with a market-based performance conditions.
For cash-settled options, the fair value of the employee services received in exchange for the grant of the
options is recognised as an increase in the investment in the subsidiary, with a corresponding increase in
the share based payment liability, over the period that the employees unconditionally become entitled to
the award.
Upon exercise of the equity-settled share options the proceeds received are allocated to share capital and
share premium. On settlement of the cash award the share based payment liability is released.
Quartix Technologies plc
84
Financial statements for the year ended 31 December 2024
1
Summary of significant accounting policies (continued)
Share capital and reserves
Share capital and reserves comprises the following:
•
"Share capital" represents the nominal value of equity shares
•
"Share premium account" represents the excess over nominal value of the fair value of
consideration received for equity shares, net of expenses of the share issue
•
“Capital redemption reserve” represents the amount by which the Company's issued share capital
is diminished when shares are redeemed or purchased wholly out of the Company's profits
•
“Equity reserve” is used to reflect the expenses associated with granting share options to employees
and the issue of warrants
•
"Retained earnings" represents retained profits
2
Profit and loss account
Auditors' remuneration attributable to the Company is as follows:
2024
2023
£’000
£’000
Audit fees – statutory audit
36
36
3
Directors and employees
Staff costs, including Directors, comprised the following:
2024
2023
£’000
£’000
Wages and salaries
136
196
Social security costs
13
19
149
215
The average number of employees for the company, being the Executive Chairman and the Non-
Executive Directors, during the year was 3 (2023: 3).
Details of Directors’ emoluments are set out on page 33.
4
Investments – non-current
The amounts recognised in the Company’s Statement of Financial Position relate to the following:
Subsidiary
undertakings
£’000
At 1 January 2023
20,256
Increase:
Due to share options held by subsidiary employees
78
Investment in subsidiary
Net book amount at 31 December 2023
20,334
Decrease:
Due to share options held by subsidiary employees
(47)
Investment in subsidiary
Net book amount at 31 December 2024
20,285
Quartix Technologies plc
85
Financial statements for the year ended 31 December 2024
4
Investments – non-current (continued)
There is no provision for impairment for the investment in subsidiaries.
Subsidiary
Country of
registration
Class of share
capital held
Proportion held
by the Company
Nature of
business
Quartix Limited
England & Wales
Ordinary shares
100%
Vehicle Tracking
Quartix Inc
USA
Common shares
100%
Vehicle Tracking
Quartix SAS
France
Ordinary shares
0.1%*
Vehicle Tracking
*The investment in Quartix SAS was 100% at 31 December 2023 and fell to 0.1% on 1 January 2024
when shares in Quartix SAS were issued to Quartix Limited in return for the contribution of Quartix
Limited’s French branch.
See note 12 of the consolidated financial statements for details of the registered offices for the above
subsidiaries.
5
Debtors
2024
2023
£’000
£’000
Social security and other taxes
30
24
Prepayments
11
15
Amounts owed by subsidiary undertakings
70
65
111
104
All receivables fall due within one year of the Statement of Financial Position date.
The amount owed by subsidiary undertakings includes a US dollar loan to Quartix Inc of £0.1m (2023:
£0.1m) which is repayable on or before 31 December 2024 but can be extended by mutual agreement.
Interest was charged quarterly at 2.1% per quarter on the quarter end balance.
6
Creditors: amounts falling due within one year
2024
2023
£’000
£’000
Social security and other taxes
5
4
Accruals and deferred income
75
54
Amounts owed to subsidiary undertakings
472
3,896
552
3,954
The amount owed to subsidiary undertakings relates to the current account with Quartix Limited. The
movement in the year reflects the £5.1m dividend declaration in the year 2024 (2023: nil).
7
Share capital
Allotted, called up and fully paid ordinary shares of £0.01 each
Number of
ordinary
shares of
£0.01 each
Share
capital
£’000
Share
premium
£’000
At 1 January and 31 December
2024
48,392,178
484
6,332
Details of movements in share options and those outstanding at 31 December 2024 are disclosed in note
24 of the Group accounts.
Quartix Technologies plc
86
Financial statements for the year ended 31 December 2024
8
Related party transactions and ultimate controlling party
The Company has taken advantage of the exemption not to disclose transactions with wholly owned
subsidiaries. Details of Directors’ remuneration and interests in shares are disclosed in the Directors’
Remuneration Report (see pages 33-34) and key management remuneration in note 6 of the Group
accounts.
9
Contingent liabilities
There are no material contingent liabilities subsisting at 31 December 2024 or 31 December 2023.
10
Financial commitments
The Company had no financial commitments at 31 December 2024 or 31 December 2023.
11
Risk management objectives and policies
Financial Instruments
The Company uses various financial instruments; these include cash deposits and bank loans and various
items such as Group receivables and Group payables that arise directly from its operations. The main
purpose of these financial instruments is to manage working capital.
The main risks arising from the Company’s financial instruments are credit risk and currency risk. The
Board reviews and agrees policies for managing each of these risks and they are summarised below.
Credit risk
The Company’s exposure to credit risk is limited to the carrying amount of financial assets recognised at
the Statement of Financial Position date, as summarised below:
2024
2023
£’000
£’000
Financial Assets
Cash and cash equivalents
41
134
Amounts owed by subsidiary undertakings
70
65
111
199
Risks associated with cash deposits are limited as the banks used have high credit ratings assigned by
international credit rating agencies. The amount owed by subsidiary undertakings includes a US dollar loan
to Quartix Inc of £0.1m (2023: £0.1m) which is repayable on or before 31 December 2024 but can be
extended by mutual agreement. Interest was charged quarterly at 2.1% per quarter on the quarter end
balance.
Currency risk
The Company is exposed to transaction foreign exchange risk. The Group mitigates its risk to the US Dollar
by trading in the USA; however, the Company is exposed to exchange movements on its US Dollar loan
to Quartix Inc to fund its working capital requirements.
The Company’s financial assets denominated in foreign currencies (all US dollars) were:
2024
2023
£’000
£’000
Financial assets
Cash at bank
-
45
Amounts owed by subsidiary undertakings
70
65
70
110
The Company’s net profit would not be materially impacted by 5% strengthening of Pound Sterling to the
US dollar.
87
Notice of Annual General Meeting
Notice is hereby given that the tenth Annual General Meeting (the “Meeting”) of Quartix Technologies plc
will be held on Monday 31st March 2025 at 10.30am at the Company’s registered offices No.9 Journey
Campus, Castle Park, Cambridge, CB3 0AX for the purpose of considering the resolutions below.
To consider, and if deemed fit, to pass the following as ordinary resolutions:
1.
To receive and adopt the audited annual accounts for the year ended 31 December 2024.
2.
To approve and declare a final dividend for the year ended 31 December 2024 of 3.00p per ordinary
share and no supplementary dividend, a total final dividend of 3.00p per share. This will be paid
on 30 April 2025 to shareholders on the register as at the close of business on 3 April 2025.
3.
To re-elect Andrew Walters as a Director who, in accordance with the Company’s Articles of
Association, retires as a Director and is eligible for re-election.
4.
To re-elect Alison Seekings as a Director who, in accordance with the Company’s Articles of
Association, retires as a Director and is eligible for re-election.
5.
To re-elect Ian Spence as a Director who, in accordance with the Company’s Articles of
Association, retires as a Director and is eligible for re-election.
6.
To re-appoint PKF Littlejohn LLP as the auditors of the Company until the end of the next Annual
General Meeting.
7.
To authorise the Directors to determine the remuneration of the auditors.
8.
To give the Directors general and unconditional authorisation for the purposes of section 551 and
573 of the Companies Act 2006 (the “Act”) to exercise all powers of the Company to allot shares
in the Company or to grant rights to subscribe for or to convert any security into shares in the
Company up to a maximum nominal value of £161,241 (representing approximately 33% of the
issued share capital of the Company as at 28 February 2025) to such persons at such times and on
such terms they deem proper provided that this authority shall expire at the conclusion of the next
Annual General Meeting of the Company or 30 June 2025, whichever is earlier, save that the
Company may, before such expiry, make an offer or agreement which would or might require
equity securities (as defined in section 560 of the Act) to be allotted after such expiry and the
Directors may allot such securities in pursuance of such offer or agreement as if the authority
conferred hereby had not expired; and all prior authorities to allot securities (to the extent
unutilised) be revoked, but without prejudice to the allotment of any shares or securities already
made or to be made pursuant to such prior authorisation.
To consider, and if deemed fit, to pass the following as special resolutions:
9.
That the Directors be and are empowered, pursuant to section 570 of the Companies Act 2006
(the “Act”), to allot equity securities (as defined in section 560 of the Act) for cash pursuant to the
authority conferred upon them by resolution 11 above and to allot equity securities (as defined in
section 560(3) of the Act (sale of treasury shares)) for cash in each case as if section 561 of the Act did
not apply to any such allotment provided, however, that the power conferred by this resolution
shall be limited to:
88
a.
The allotment of equity securities in connection with a rights issue, open offer or any other
offer of, or invitation to apply for, equity securities in favour of holders of ordinary shares
in the Company on the register of members at such record dates as the Directors may
determine and other persons entitled to participate therein where the equity securities
respectively attributable to the interests of the ordinary shareholders are proportionate (as
nearly as may be) to the respective number of ordinary shares in the Company held or
deemed to be held by them on any such record dates, subject to such exclusions or other
arrangements as the Directors may consider necessary or expedient to deal with fractional
entitlements, treasury shares, record dates, or legal or practical problems arising or
resulting from the application of the laws of any overseas territory or the requirements of
any other recognised regulatory body or stock exchange in any territory or by virtue of
shares being represented by depository receipts or any other matter whatever; and
b.
The allotment, other than pursuant to sub-paragraph ‘a’ above, to any person or persons
of equity securities up to an aggregate nominal value not exceeding £24,186, representing
approximately 5% of the ordinary share capital in issue as at 28 February 2025.
This power shall expire at the conclusion of the next Annual General Meeting of the Company or
30 June 2025, whichever is the earlier, unless previously varied, revoked or renewed by the
Company in general meeting provided that the Company may, before such expiry, make any offer
or agreement which would or might require securities to be allotted, or treasury shares sold, after
such expiry and the Directors may allot securities or sell treasury shares pursuant to any such offer
or agreement as if the power conferred had not expired; and all prior powers granted under section
570 of the Act shall be revoked provided that such revocation shall not have retrospective effect.
10.
That the Directors be generally and unconditionally authorised, for the purposes of section 701 of
the Companies Act 2006 (the “Act”), to make market purchases, as defined in section 693(4) of
the Act, of ordinary shares of £0.01 each in the Company on such terms and in such manner as
the Directors shall determine, provided that:
a.
The maximum aggregate number of ordinary shares which may be purchased is 2,418,609
(representing approximately 5% of the ordinary share capital in issue as at 28 February
2025);
b.
The minimum price that may be paid for an ordinary share is its nominal value (£0.01);
c.
The maximum price, exclusive of any expenses, which may be paid for an ordinary share
shall be the higher of:
i.
an amount equal to 105% of the average middle market quotations for the ordinary
shares of the Company as derived from the AIM appendix to the London Stock
Exchange Daily Official List for the five business days immediately preceding the day
on which the ordinary share is purchased; and
ii.
an amount equal to the higher of the price quoted for the last independent trade of
an ordinary share and the highest current independent bid for an ordinary share on
the trading venue where the purchase is carried out.
d.
This authority shall expire, unless previously renewed, revoked or varied, on the date of
the next Annual General Meeting or 30 June 2025, whichever is earlier, save that the
Company may enter into a contract for the purchase of ordinary shares under this
authority which would or might be completed, wholly or partly, after this authority expires.
By order of the Board on 28 February 2025.
Sally Morton
Company Secretary
89
Notes to the Notice of Annual General Meeting
The following notes explain your general rights as a shareholder and your right to attend and vote at this
Meeting or to appoint someone else to attend and vote on your behalf.
1
To be entitled to attend and vote at the Meeting (and for the purpose of the determination by the Company
of the number of votes they may cast), shareholders must be registered in the Register of Members of the
Company at 6.00pm on 27 March 2025. Changes to the Register of Members after the relevant deadline
shall be disregarded in determining the rights of any person to attend and vote at the Meeting.
2
Shareholders, or their proxies, intending to attend the Meeting in person are requested, if possible, to arrive
at the Meeting venue at least 30 minutes prior to the commencement of the Meeting at 10:30 am (UK time)
on 31 March 2025 so that their shareholding may be checked against the Company’s Register of Members
and attendances recorded.
3
Shareholders are entitled to appoint another person as a proxy to exercise all or part of their rights to attend
and to speak and vote on their behalf at the Meeting. A shareholder may appoint more than one proxy in
relation to the Meeting provided that each proxy is appointed to exercise the rights attached to a different
ordinary share or ordinary shares held by that shareholder. A proxy need not be a shareholder of the
Company.
4
In the case of joint holders, where more than one of the joint holders’ purports to appoint a proxy, only
the appointment submitted by the most senior holder will be accepted. Seniority is determined by the
order in which the names of the joint holders appear in the Company’s Register of Members in respect of
the joint holding (the first named being the most senior).
5
A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of
votes for or against the resolution. If no voting indication is given, your proxy will vote or abstain from
voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in
relation to any other matter which is put before the Meeting.
6
In order for a proxy appointment to be valid, a form of proxy must be completed. You can appoint a proxy
and indicate how you would like your proxy to vote at the Meeting or any adjournment by using any of the
following methods:
•
by logging on to uk.investorcentre.mpms.mufg.com or using the Investor Centre app (see below)
and following the instructions, ensuring that your submission is completed before 10:30 am on 27
March 2025;
•
in the case of CREST members, by utilising the CREST electronic proxy appointment service in
accordance with the procedures set out below, transmitting the instructions so as to be received by
10:30 am on 27 March 2025; or
•
If you are an institutional investor by using the Proximity platform as described in Note 12 below.
You may request a hard copy form of proxy directly from the registrars, MUFG Corporate Markets, via
email at shareholderenquiries@cm.mpms.mufg.com or on Tel: 0371 664 0391. Calls are charged at the
standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at
the applicable international rate. Lines are open between 09:00 – 17:30, Monday to Friday, excluding public
holidays in England and Wales.
90
Shareholders can vote electronically via the Investor Centre, a free app for smartphone and tablet provided
by MUFG Corporate Markets (the company's registrar). It allows you to securely manage and monitor your
shareholdings in real time, take part in online voting, keep your details up to date, access a range of
information including payment history and much more. The app is available to download on both the Apple
App Store and Google Play, or by scanning the relevant QR code below. Alternatively, you may access the
Investor Centre via a web browser at: uk.investorcentre.mpms.mufg.com.
7
If you return more than one proxy appointment, either by paper or electronic communication, the
appointment received last by the Registrar before the latest time for the receipt of proxies will take
precedence. You are advised to read the terms and conditions of use carefully. Electronic communication
facilities are open to all shareholders and those who use them will not be disadvantaged.
8
The return of a completed form of proxy, electronic filing, any CREST Proxy Instruction (as described in
note 10 below) or the appointment of a proxy via Proxymity will not prevent a shareholder from attending
the Meeting and voting in person if he/she wishes to do so.
9
CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy
appointment service may do so for the Meeting (and any adjournment of the Meeting) by using the
procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored
members, and those CREST members who have appointed a service provider(s), should refer to their
CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their
behalf.
10
In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate
CREST message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with
Euroclear UK & International Limited’s specifications and must contain the information required for such
instructions, as described in the CREST Manual. The message must be transmitted so as to be received by
the issuer’s agent (ID RA10) by 10:30 am on 27 March 2025. For this purpose, the time of receipt will be
taken to mean the time (as determined by the timestamp applied to the message by the CREST application
host) from which the issuer’s agent is able to retrieve the message by enquiry to CREST in the manner
prescribed by CREST. After this time, any change of instructions to proxies appointed through CREST
should be communicated to the appointee through other means.
11
CREST members and, where applicable, their CREST sponsors or voting service providers should note
that Euroclear UK & International Limited does not make available special procedures in CREST for any
particular message. Normal system timings and limitations will, therefore, apply in relation to the input of
CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the
CREST member is a CREST personal member, or sponsored member, or has appointed a voting service
provider(s), to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall
be necessary to ensure that a message is transmitted by means of the CREST system by any particular time.
91
In this connection, CREST members and, where applicable, their CREST sponsors or voting system
providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations
of the CREST system and timings. The Company may treat as invalid a CREST Proxy Instruction in the
circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
12
Appointment of Proxies via Proxymity: If you are an institutional investor you may also be able to appoint
a proxy electronically via the Proxymity platform, a process which has been agreed by the Company and
approved by the Registrar. For further information regarding Proxymity, please go to www.proxymity.io.
Your proxy must be lodged by 10:30 am on 27 March 2025 in order to be considered valid or, if the meeting
is adjourned, by the time which is 48 hours before the time of the adjourned meeting. Before you can
appoint a proxy via this process you will need to have agreed to Proxymity’s associated terms and
conditions. It is important that you read these carefully as you will be bound by them and they will govern
the electronic appointment of your proxy. An electronic proxy appointment via the Proxymity platform
may be revoked completely by sending an authenticated message via the platform instructing the removal
of your proxy vote.
13
Any corporation which is a shareholder can appoint one or more corporate representatives who may
exercise on its behalf all of its powers as a shareholder provided that no more than one corporate
representative exercises powers in relation to the same shares.
14
As at 28 February 2025 (being the latest practicable business day prior to the publication of this Notice),
the Company’s ordinary issued share capital consists of 48,392,178 ordinary shares, carrying one vote each.
Therefore, the total voting rights in the Company as at 28 February 2025 are 48,392,178.
15
Any shareholder attending the Meeting has the right to ask questions. The Company must cause to be
answered any such question relating to the business being dealt with at the Meeting but no such answer
need be given if: (a) to do so would interfere unduly with the preparation for the Meeting or involve the
disclosure of confidential information; (b) the answer has already been given on a website in the form of
an answer to a question; or (c) it is undesirable in the interests of the Company or the good order of the
Meeting that the question be answered
16
The following documents are available for inspection during normal business hours at the registered office
of the Company on any business day from the date of this Notice until the time of the Meeting and may
also be inspected at the Meeting venue, as specified in this Notice, from 10:15 am on the day of the Meeting
until the conclusion of the Meeting:
•
copies of the Directors’ letters of appointment or service contracts
17
You may not use any electronic address (within the meaning of Section 333(4) of the Companies Act
2006) which is provided in either this Notice or any related documents (including the form of proxy) to
communicate with the Company for any purposes other than those expressly stated.
A copy of this Notice, and other information required by Section 311A of the Companies Act 2006, can
be found on the Company’s website at www.quartix.com/en-gb/company/investors/
Any general queries by members about the Annual General Meeting should be addressed to the Company
Secretary by letter or email at Quartix Technologies plc, No.9 Journey Campus, Castle Park, Cambridge
CB3 0AX or investors@quartix.net
Perivan.com
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